AmWest Funding Corporation Continues Strong Growth in 2024 with New Strategic Partnership

Rhea-AI Summary

AmWest Funding , in partnership with Ares Management , continues its strong growth in 2024 with a joint venture to invest in Non-QM loans. The collaboration will leverage AmWest's leading position in mortgage origination and servicing, with Ares providing 90% of the capital. The partnership aims to capitalize on the expertise of both companies to securitize mortgage loans and grow the business in the residential mortgage space.

Positive

• AmWest and Ares finalize a joint venture to invest in Non-QM loans.
• Ares will provide 90% of the joint venture's capital.
• AmWest has securitized $3.1 billion in unpaid principal balance in the last 3 years.
• The partnership aims to securitize mortgage loans using the HOMES and PRKCM shelves.
• Ares Alternative Credit strategy manages approximately $33.9 billion in assets under management.
• The collaboration between AmWest and Ares showcases a strong partnership in the residential mortgage space.

Negative

• None.

Insights

Financial Analyst

The joint venture between AmWest Funding Corporation and Ares Management Corporation signifies a strategic maneuver to bolster their foothold in the Non-QM loan market. AmWest's commitment of 10% capital, juxtaposed with Ares' hefty 90%, not only underscores the asymmetric investment but also reflects the degree of involvement and confidence each party brings to the table. This partnership will likely leverage AmWest's established prowess in mortgage origination and servicing, while capital injection from Ares could amplify their capacity for loan securitizations. From an investor's standpoint, the potential for increased securitization activities may offer an avenue for diversified revenue streams, a factor that could bode well for the solidity and growth prospects of both entities.

Market Research Analyst

Through the prism of market trends, the creation of the joint venture aligns with the growing appetite for investment in Non-QM loans, a sector that is gaining traction as an alternative to traditional mortgage lending. Such strategic partnerships can often result in enhanced operational efficiencies and competitive advantages. Given AmWest's track record of over $15 billion in Non-QM mortgage originations, investors may find solace in the company's expertise and standing. However, it is critical to gauge the broader economic indicators, such as interest rates and housing market dynamics, that could influence the performance of investments in Non-QM loans. Investors should consider how these macroeconomic factors might affect the joint venture's strategy and profitability.

Legal Expert

From a legal perspective, the involvement of Mayer Brown LLP provides a layer of diligence and expertise that could be pivotal in navigating the complex regulatory landscape of the mortgage and securitization sector. The legal framework governing Non-QM loans and securitizations is stringent and having seasoned counsel can mitigate potential legal risks associated with the joint venture's operations. Investors should take note of this aspect, as it can play a significant role in ensuring compliance, thus safeguarding the venture's viability and protecting stakeholder interests.

BREA, Calif., April 24, 2024 /PRNewswire/ -- AmWest Funding Corporation ("AmWest"), funds managed by Ares Management Corporation's (NYSE:ARES) ("Ares") Alternative Credit strategy, and Park Capital Management ("Park Capital") announced today that AmWest and Ares have finalized a joint venture to purchase and invest in Non-QM loans, sourced and serviced by AmWest. The joint venture will seek to capitalize on AmWest's strong position as a leading mortgage originator and servicer with over $15 billion of Non-QM mortgage originations since inception, primarily sourced via its national wholesale platform.

"We are pleased to enter into this partnership with Ares, which will allow us to grow our business and further capitalize on the current market environment," said William Park, Founder and Chairman of AmWest. "We pride ourselves in the trusted brand that we have built and look forward to continuing to support mortgage brokers and homebuyers with exceptional products and service."

"Our partnership with Ares is a testament to the confidence we have in our operating platform and our strategy of building and developing Park Capital Management," said Kenneth Jo, Chief Executive Officer of AmWest. "We look forward to working with the Ares team to source and securitize attractive residential mortgage investments together in the years ahead."

Ares will provide 90% of the joint venture's capital with AmWest providing the remaining 10%. This collaboration is expected to benefit from the experience of AmWest and Ares' leadership teams alongside a successful track record of building large-scale Non-QM investment and securitization platforms. AmWest has securitized a combined $3.1 billion in unpaid principal balance in the last 3 years. The joint venture will seek to securitize the mortgage loans using the HOMES and PRKCM shelves.

"This partnership furthers Ares' evolution as an important player in the residential mortgage space," said Kevin Alexander, Partner in the Ares Credit Group "AmWest's ability to originate and service superior mortgage assets is a perfect fit for Ares' Alternative Credit's mandate."

The Ares Alternative Credit strategy is one of the largest investors in asset based credit managing approximately $33.9 billion in assets under management as of December 31, 2023. The team invests across the capital structure and seeks opportunities in specialty finance, lender finance, loan portfolios, equipment leasing, structured products, net lease, cash flow streams (royalties, licensing, management fees) and other asset-focused investments.

"As a platform that is invested across the mortgage space from multiple pockets of capital, Ares was able to provide a solution that fit AmWest to grow their business," said Michael Flynn, Managing Director in the Ares Credit Group. "Both Ares and AmWest are focused on building this partnership to source assets with strong credit quality that will ultimately lead to successful securitization platforms."

ATLAS SP Partners served as sole financial advisor and Mayer Brown LLP served as legal counsel to both AmWest and Park Capital in connection with the transaction.

About Ares Management Corporation

Ares Management Corporation (NYSE: ARES) is a leading global alternative investment manager offering clients complementary primary and secondary investment solutions across the credit, private equity, real estate and infrastructure asset classes. We seek to provide flexible capital to support businesses and create value for our stakeholders and within our communities. By collaborating across our investment groups, we aim to generate consistent and attractive investment returns throughout market cycles. As of December 31, 2023, Ares Management Corporation's global platform had approximately $419 billion of assets under management with approximately 2,850 employees operating across North America, Europe, Asia Pacific and the Middle East. For more information, please visit www.aresmgmt.com.

About AmWest Funding Corporation

AmWest Funding Corporation, based in Brea, California, was originally founded in 1995. The company originates Federal Housing Administration (FHA), Veterans Administration, USDA, and conventional conforming residential mortgage loans that adhere to the standards established by the government-sponsored enterprises (Fannie Mae, Freddie Mac, and Ginnie Mae), as well as government agency, prime jumbo, and Non-QM loans. The organization is driven by a management team possessing an average of two decades of experience. Focused on providing home loans responsibly throughout the communities we serve, AmWest's goal is to provide exceptional customer experience for its clients. AmWest helps clients achieve the dream of home ownership or seize today's real estate investment opportunities. For more information on AmWest Funding Corp., visit www.amwestfunding.com.

About Park Capital Management

Park Capital Management is an affiliate of AmWest Funding Corporation. The Company invests in residential mortgage loans and has expertise in capital markets execution.

Contact
Kenneth Jo
(714) 831-3333 

 

View original content:https://www.prnewswire.com/news-releases/amwest-funding-corporation-continues-strong-growth-in-2024-with-new-strategic-partnership-302126719.html

SOURCE AmWest Funding Corporation

FAQ

What is the strategic partnership announced by AmWest Funding in 2024?

AmWest Funding announced a joint venture with Ares Management to invest in Non-QM loans.

Who will provide 90% of the capital for the joint venture?

Ares Management will provide 90% of the capital for the joint venture.

What is the total unpaid principal balance securitized by AmWest in the last 3 years?

AmWest has securitized a combined $3.1 billion in unpaid principal balance in the last 3 years.

How will the joint venture securitize mortgage loans?

The joint venture will seek to securitize the mortgage loans using the HOMES and PRKCM shelves.

How much does Ares Alternative Credit strategy manage in assets under management?

Ares Alternative Credit strategy manages approximately $33.9 billion in assets under management.

What does the collaboration between AmWest and Ares aim to achieve?

The collaboration aims to source assets with strong credit quality and build successful securitization platforms in the residential mortgage space.