Semper Fi.

The motto of the United States Marine Corps, which means “always faithful,” has become the very foundation of integrity, discipline, loyalty, an d courage.

So, it only makes sense that when fellow service members and friends John Warren and John Thompson finished their tours with the Marines and agreed to become business partners in the real estate industry, the two would build a company that exemplified those same core values.

Their initial interest was flipping homes, but while getting started in 2010, the two found a golden opportunity in the lending space in Atlanta, Georgia. Much as they had a calling to serve their country, the men also felt compelled to help investors find financing solutions and reach their goals. They wanted to be part of something that would foster strong, thriving neighborhoods. Soon after, they founded Lima One Capital, named after the pair’s call sign during their tour of duty in Iraq.

The following year, Lima One Capital moved its headquarters to Greenville, South Carolina. By 2012, the company was gaining traction as a top lender in Atlanta with $10 million in originations. It was at this time that Warren reconnected with Josh Woodward, whom he had met through a previous business venture while Woodward was still in college. Woodward had been working in corporate banking and was looking to pivot in his career. Woodward joined Lima One in 2013 as the company’s sixth employee and was responsible for building out the company’s financial infrastructure and, eventually, its in-house servicing team.

“It was an interesting time for business-purpose lending. There was a reason it was almost exclusively referred to as ‘hard money lending.’ Everything about it was harder, from the loan terms themselves to the capital markets to the tools and technology,” Woodward said.

“By then, Lima One had originated $25 million in total and established itself with a track record of loans that were performing very well. We didn’t have the backing of a large fund or institutional investor group, so my job was to help raise money and grow our capital-intensive business while protecting our ownership and control. We gained momentum and started to expand.”

Over the course of the next decade, Woodward established his own track record within Lima One. So much, in fact, that in July of 2024, as the company closed in on an impressive $10 billion in lifetime originations, Woodward was named President and Chief Executive Officer of the company.

Hard Fought Battles

Residential Transition Lending (RTL) and Debt Service Coverage Ratio (DSCR) are common phrases in the industry today, but that was far from the case when Woodward joined Lima One. The company found itself facing the front lines of skepticism and fear of the unknown.

“Terms like RTL and DSCR didn’t even exist back then. We were building an industry and the terms to describe it from scratch. To be blunt, this was 2013 and 2014, people were still scarred from the great financial crisis, and the bridge lending industry had a scarlet letter on its chest,” said Woodward. “It was very hard to raise money into a business like that. You had to spend a lot of time educating and trying to explain what a fix-and-flip loan even was before we could begin to tell our story. But formation requires repetition, so we told our story over and over again. We had some history, but not a lot. There was almost no one out there doing this type of lending on a regional scale, much less nationally, and the financial markets’ understanding of the ’hard money lending’ business was even more limited. That’s what we were swimming upstream against.”

Originating loans in that environment was labor intensive and challenging, but Lima One had the advantage of its founders’ military background—they brought discipline, execution, and attention to detail into underwriting, training, and team building, Woodward noted. That made a difference in the company’s ability to focus on writing good loans and building good teams—even when they didn’t yet have the scale to recruit nationally.

“It was not just convincing capital providers, but it was also trying to recruit people to come on board and do this unique work for this unique company,” he said. “It was difficult. There was a lot to threading that needle of ‘trust us’ when we were still a mostly unproven company at that time. We focused on hiring people with core competencies and training them on the specifics of our business.”

The team’s strategy worked. By 2014, Lima One successfully added a new no-rehab bridge loan to its portfolio of products. In that time, the company also grew to 15 employees and was named one of the fastest-growing companies in South Carolina. In the years that followed, the company was licensed across the country, grew the workforce to 50 employees, and added rental DSCR and multifamily bridge loan products to its suite of products.

Strength in Numbers

Momentum had been built methodically, and then the flywheel started to turn. Lima One carried out the steps needed to reach a goal that company leaders had established as critical to the business early on—vertical integration. One more piece of that puzzle fell in place by 2017 when the company launched an in-house construction management department. The move afforded Lima One the opportunity to handle rehab and construction draws as well as review all budgets before loans were closed. Now 100 employees strong, a year later in 2018 the company reached another milestone—it surpassed over $1 billion in lifetime originations, doubling that number in 2019 and adding $2 billion in originations every year after that.

“What was the fuel to our fire? Some of it was good timing. It’s been a 10-year-plus bull market housing run, and we took advantage of that. But we also gained confidence in our understanding of the business and our decision-making, and that allowed us to press for scalability. Then, with a proven history and strong people and process, we were able to start growing financially as well,” said Woodward. “Capital markets became more favorable as debt and equity providers as well as loan and bond buyers really started to understand our business and the asset class as a whole. We established a track record, hired great people, and our loans performed well. We turned a trade into an investible business.”

Not even a global pandemic could stop the momentum.

Woodward said the company’s growth allowed them to innovate additional loan types and features and create a full product ecosystem. In 2020, when much of the world struggled to stay afloat, vertical integration and sound partnerships carried Lima One.

“We knew from the beginning that we had to build an integrated front-to-back process that was supported by talented and well-trained people and good technology from the start of the loan submission all the way through to the payoff. We also needed it all under one roof. Vertical functional integration allowed us to be efficient and really optimize the entire order of operations,” he said. “It allows us to have a quick feedback loop for our customers and for risk management and to respond to the environment quickly when we need to.”

Diversity Provides Agility

The ability to pivot is a critical advantage for companies, especially mortgage companies. Lima One’s growth in the real estate lending space was, in part, due to the importance company leaders placed on building out various avenues to be nimble and grow when others were blocked.

“Since the inception of the company, we have been big believers in the value of diversity. We have methodically innovated and developed new products which provide us a key advantage,” Woodward said. “Its diversity of products, diversity of channels, diversity of geography and customer base—those things combined give us multiple ways to win. Had we been a monoline, one-product, or one-channel company we probably wouldn’t have made it.”

For instance, he noted, companies that were heavily reliant on rental loans when the COVID-19 pandemic hit struggled as those products weren’t an option for a while due to secondary market hesitation. During that time, Lima One turned to its construction, fix-and-flip, and multifamily lending products. Post-COVID, when rates went down and rental loans soared, the company was agile enough to return to those products in force.

“It not only creates multiple ways to win, but it creates durability. It allows you to be adaptable when the environment changes,” Woodward said. “Over the course of our history, we have seen and can recognize the ebbs and flows. There have been years when fix-and-flip was our best product. Then, in other years, construction lending was our best product. My philosophy has always been, we can’t predict the future, so let’s not try to build a business that has to. Let’s build one that can thrive and survive no matter what comes our way. That plays to your favor over the course of time. That’s where we have been very successful.”

A vertical integration strategy has helped the company acquire feedback quickly on changing market conditions, like sudden fluctuations in interest rates. It has strengthened the ability to measure risk in real-time and adjust accordingly.

“That has allowed us to become a sustainable franchise,” he said. “And it has also been instrumental in opening up sales channels and has helped us identify the best customers and the best loans in the space and aggressively pursue those.”

Never Stop Learning

A diverse product offering enabled Lima One to continue growth following the pandemic, but leaders at the company viewed the occurrence as a time of reflection on how to better safeguard against such disruptions to business in the future.

“We were almost exclusively a whole loan seller prior to COVID,” Woodward said. “While that strategy had its advantages in fostering growth, in times of turmoil, a thin or retracting secondary market for the loans could cause a great deal of hurt for companies solely reliant on an originate-to-sell strategy.”

“When our loan buyers went away during COVID, we wondered how we were going to navigate. Fortunately, we dug our well long before we were thirsty. Because of our deep and long-standing relationships with our banks, warehouse lines, and equity partners, we didn’t feel the same level of pressure that many others did. With that said, we did realize that if COVID had gone on too much longer, and secondary markets were disrupted much longer, we might not have been able to sustain our business.”

In a proactive effort to address this concern and continue expansion with secure and permanent   to lend, Lima One entered a partnership with MFA Financial Inc., an investor and loan buyer with the company for several years prior. MFA Financial Inc. acquired complete ownership of Lima One in 2021.

“They were a great partner previously, and now together we have been able to finance the business in a very efficient way. We don’t have to worry about dry powder to fund loans. We can originate as many good loans as we can find. It was transformational for us. We were no longer worried about how to fund our business,” he said. “We now have stability and security. Adding that capital markets firepower, in combination with the additional credit expertise, has allowed us to scale very quickly. Since then, we have also focused on making other parts of our business better. It not only allowed us to weather the storm, but the MFA acquisition really elevated us. We came out as one of the strongest lenders in the space.”

What Counts on the Inside

By the time Lima One opened its west coast hub office in Irvine, California, in 2022, the workforce blossomed to 300 employees. As a growing mid-market enterprise, a rich company culture has been born out of the same ethos established by the founders. It is a culture full of virtues that Lima One will always stand behind – discipline, teamwork, integrity, and accountability.

“No one magic loan product or sales channel or procedure or technology has made us successful. It’s the way we make everything work together and the combination of our people, technology, and processes that allows us to succeed. We do a thousand little things well, carefully coordinated and seamlessly executed,” said Woodward.

“When you are in a business where you are competing against product specialists, you have to be excellent everywhere—otherwise we are going to be average, and that’s not our standard.”

Woodward said Lima One prides itself on being a company that values the opinions and suggestions of its employees. Humility goes a long way in this business, he noted, especially as the company expands and more diverse expertise and perspectives come into play. It is a quality the company embraces as it strives for continuous improvement.

“We really want to be an organization that lives out transparency, teamwork, accountability, integrity, hard work, and excellence. That goes back to the military culture of our founders,” he said. “To do that successfully, you have to look at what you are doing and constantly evaluate if there is something we can do better. That is what ultimately creates excellence. We want to identify and close gaps. And I would like to think we have a little fun along the way. That is the standard for us.”

A strong organization that relies on cohesiveness breeds resilience, Woodward noted. Lima One leaders understand there will always be problems to solve and an ongoing effort to build a mentality of tenacity. One of the things he reiterates to his employees at Lima One is that everything doesn’t have to be perfect to have a good culture or have strong values as a company.

“We just have to stay humble enough to recognize that we are not everything we want to be,” he said. “There will always be new levels of excellence to achieve, and we are going to always fight really hard every day to get to that next level. That’s the fun and that’s the challenge.”

Forward, March

Following Lima One’s 2023 addition of a new loan origination system that streamlines turn times and enhances customer experience, the company now operates a platform that includes in-house underwriting, processing, construction management, and servicing.

Later this year, Lima One plans to further leverage the power of technology with the launch of a customer-facing portal that will enable investors to have more visibility and control of their loans with the company. The software will foster better communication, transparency, and convenience by keeping details in a secure, central location.

With a strong foundation in place, Woodward said going forward as the new CEO of Lima One, he intends to take a look back over the company’s progression in the last 14 years and consider how to reinforce that foundation even further for the next phase of growth.

“I would like to take some time to evaluate parts of our business where we might be good but not excellent,” he said. “There may be parts of our business where we need to focus more in order to achieve excellence. A good company culture will always be something that we emphasize. We will make sure that we are pervading our core values in everything we do,” he continued. “As long as that value system is in place, I am confident that we will figure out the rest.”

As for the real estate lending industry, Woodward is hopeful for a space that experiences stable conditions and allows those in the field to flourish. “Sometimes we make this whole business complicated. But it often comes down to great people who create and run great processes. In the 11-plus years I have been here, I am most proud of the people who have started here and are still here. They have built careers here and are passionate about building this special and powerful company,” he said. “I am now blessed to lead and serve this tremendous organization. We have had a lot of success, but in some ways, we are just getting started. The best chapters for Lima One have not yet been written.”