Many publications share that the secret to success lies in the implementation of six main principles: passion, vision, preparation, courage, perseverance, and integrity. While the team at Foundation clearly exhibits these principles, their success also rests heavily on a solid partnership built upon years of proven compatibility and drive. Having known each other for close to three decades, it’s no surprise to find John Seeburger and Chris Crovatto working together at the helm of Foundation, a private lending company specializing in off-market properties and flexible financing. The firm, which opened for business in 2018, is the third the pair have founded together following Watermen Capital in 2009 and Accord Golf Capital in 2012.
“John and I met in the mid-1990s working for a subsidiary of Bank of America,” Crovatto, who serves as Foundation’s CEO, says. “I was in the real estate group and John was in the alternative asset group covering golf and recreational finances. I was in Connecticut and John was on the West Coast. When I’d go to California for meetings, we’d talk.” They remain on their respective coasts, with Seeburger based in Foundation’s California office and Crovatto in Connecticut.
Despite just five years under its belt, Foundation packs a considerable punch in the private lender space specializing not only in traditional business purpose loans secured by 1-to-4 unit residential and multifamily properties, but also in pre-MLS and pre-foreclosure properties. This is due in large part to its alliance with American Mortgage Investment Partners Management (AMIP), an alternative asset manager that owns and manages thousands of defaulted single-family notes and REOs throughout the United States. AMIP is Foundation’s largest shareholder.
Being able to differentiate themselves from the competition is huge in a crowded industry, particularly with so little inventory to go around.
“We are offering all the same things that other lenders offer,” says Seeburger, Foundation’s president. “The loan products are fairly standardized throughout the industry. We have competitive terms, leverage, and rates. That means what really sets us apart is process, speed, creativity, and customer service on the lending front along with the ability to offer off-market assets to our customers.”
The company recently rebranded from Foundation CREF to simply Foundation. Seeburger says including CREF (commercial real estate funding) was more important in the company’s early stages.
“We found that early on there was confusion in what we had on offer. We’re very specific, we’re not providing consumer residential finance, just business purpose loans, so that’s why we used ‘CREF’,” Seeburger says. “As we’ve grown, Foundation is the name that everyone knows.”
Seeburger, Crovatto, and Foundation’s growing team specialize in the origination of new loans as well as the marketing of all pre-market properties for third party sellers. With an emphasis on shortening closing timelines and customer service, the company streamlines bridge loans to help investors take advantage of short-term business plans that can be difficult to execute without significant cash on hand.
The One-Stop Shop Approach
Another strength of Foundation’s offering lies in an impressive array of tools on its website, including advanced real estate calculators, resources, and more that appeal to potential investors of all experience levels.
“We designed the website to be a tool that the investors and borrowers we work with can use to evaluate a deal at a deeper level,” says Crovatto.
“They can get a real feel for whether a deal makes sense or not. It provides everything they need to pull comps, run profit and yield calculators, estimate loan terms, or calculate refi cash-out proceeds all in one spot. We strived to create a very easy-to-use platform where with just three inputs you can get a sophisticated investment profile with a detailed settlement statement that can be fine-tuned in minutes to within $1,000 or $2,000 of the final net closing amounts,” adds Seeburger. “We’re using the data intelligence extracted from 10,000 loan modifications and resolutions by our majority shareholder so there’s a lot going on under the hood, and it’s really cool stuff.”
A real standout on Foundation’s website is the PropertyPortal™, a patent-pending engine where anyone can search for off-the-market properties by price, state, property type, occupancy, ownership, size, year built, and several other criteria. By creating an account, investors can take an extensive dive into property-specific information including property photos, inspection reports, title info, comparable sales, and BPOs. The portal even makes it possible to submit an offer to buy.
“There’s not an investor out there who isn’t looking for a new channel for finding properties at a time when inventory is very constrained,” Seeburger says. “There are fewer and fewer homes to buy given current market conditions, so if we can bring them inventory where there’s even one more property a year for them, that’s a powerful value proposition to a buyer. Because we provide an investor with unique tools and back them up with deep knowledge within the default space, private lending, and commercial real estate, we help to elevate that customer’s game. We also pride ourselves on serving as a consultative sounding board for our customers.”
Looking Ahead
“We’ve been a small shop, but we’re growing,” says Crovatto. “We see our market share growing and we continue to hone our trade and put together a top team. We’re very nimble, smaller than most, but we do more with less and use technology to our advantage.
“Our goal is to become a major player in the market while many larger shops are downsizing due to current market conditions. The reality is that there is not an endless supply of business, so we are focused on providing a high service level and taking advantage of good opportunities, some of which are not right down the middle, to be able to grow the company profitably.”
