By Lara Schwartz – Staff reporter, Cincinnati Business Courier
Feb 7, 2025
STORY HIGHLIGHTS
Above: Spring Garden Lending President, Andy Rachlin and Omar ElhagMusa, SVP, Commercial Lending, Market Leader, Market Leader, Columbus and Cincinnati Metros
A Philadelphia-based real estate lender has expanded into two Ohio markets.
Spring Garden Lending, a private lending group that specializes in bridge and permanent loans to acquire, rehab, construct and refinance real estate investment properties for rent or to flip, is now active in Cincinnati and Columbus.
“That is the specialization,” President Andy Rachlin told me. “Everything from (buying) a little row house that hasn’t been touched in 40 years and renovating it to sell or keep as a rental to (building) a new 40-unit apartment building with some retail on the ground floor on a commercial corridor.”
Spring Garden’s origin story starts in 2005 when Philadelphia attorney Jay Goldstein started Valley Green Bank, which focused primarily on real estate lending to small developers that were building houses in neighborhoods that reflected the financial capabilities of the residents.
During the 2008 financial crisis, Valley Green continued to finance the development of housing when other banks pulled back, making it the biggest real estate lender in the Philadelphia region for a few years.
Shortly after Valley Green sold in 2014, Goldstein launched Spring Garden Lending to focus on small- and mid-sized real estate developers and investors.
Now, Spring Garden is bringing its capabilities to Cincinnati and Columbus, led by veteran banker and now senior vice president, Omar ElhagMusa. Prior to joining Spring Garden, ElhagMusa was the Ohio statewide senior lender at IFF, a Chicago-based community development financial institution.
“We were looking for a combination of strong markets with real growth, but not crazy speculation that suggested the potential for a boom-and-bust cycle,” Rachlin said. “We were looking for a base level of affordability…that’s not to suggest that housing anywhere is cheap right now, but for several hundred thousand dollars you can still get into a house in Columbus or Cincinnati.”
Rachlin said Spring Garden was also looking for cities that had a balance between rental and for-sale housing and a degree of economic dynamism.
“Both cities were very pro-development in their administrations with smart growth policies like zoning that is allowing for added density where it makes sense, transit-oriented development where it makes sense,” Rachlin said. “Where we see policy being supportive of development, especially zoning policy, that’s a really big positive for us.”
ElhagMusa said he is encouraged by the level of intentionality that people are exhibiting in terms of housing options.
“What we’re doing is bringing in outside capital to support existing and emerging developers, bring more houses into circulation at every price point,” he said. “That allows that pressure to be relieved on naturally occurring affordable housing.”
Currently, Spring Garden is looking for office space for its Ohio operations. All of its back-office work will still be housed in Philadelphia, but its field office in Ohio will be a base for its small staff of about five local employees.
Spring Garden plans to deploy $30 million to $50 million per year in the market. Annually, it provides about $150 million to $200 million across all markets.
“Right now, we have a lot of capacity to grow,” Rachlin said. “We have access to capital that can grow way beyond that.”
Spring Garden is currently looking to make connections with local appraisers and other neighborhood experts to form relationships with.
Spring Garden is active in four other markets including its home base of Philadelphia, as well as Baltimore, Washington, D.C., and Pittsburgh.
Read the article in the Cincinnati Business Courier. >