A&S Capital co-founder Alexis Agopian discusses the impact of  building good relationships in turbulent times. Originally hailing from Argentina, Alexis worked on various real estate projects before co-founding A&S in 2017. His insider knowledge, combined with a degree in marketing and advertising, gives him a unique perspective on the real estate industry.

We’re in difficult times, economically. How has A&S adapted to the recent turbulence?

The most important thing is that we’re balance sheet lenders. In difficult times, you want to rely on a balance sheet lender. When other lenders have to shut down their businesses or stop funding, we can keep funding because we’re in greater control of our money. Of course we adapted, we had to be a little more cautious in terms of loan-to-cost and loan-to-value, and we started being a little more selective with deals. But we’ve honored all the loans we had in our pipeline. We closed them all and didn’t leave any of our clients hanging.

What do you think is the greatest challenge facing the real estate market at the moment?

I’ll put it in two different answers. For real estate investors, the first challenge is finding good deals, and once that’s done, finding the right capital structure to fund each deal. That means having a good lender. The second challenge is that right now, for investors who are already into the deal, who’ve already stabilized a property, refinancing those deals is a little bit challenging. But experienced borrowers know how to move and are able to refinance properties. And so we’re seeing refinancing, payoffs, and a lot of borrowers succeed with their exit strategies.

A&S is all about “common sense lending.” What does this mean exactly? How does common sense lending make you different from other lenders?

Common sense lending means no boxes. We don’t have to stick to a box - we don’t put restrictions on ourselves. Of course we specialize in multifamily, but we won’t say “This has to have this many units,” or “only 1-bedroom units,” or  “The borrower has to be this tall.” If the deal makes sense, if it’s a good deal and if the borrower behind the deal is experienced and has done similar projects in the past, we will find a way to fund that deal. We approach every different scenario using our common sense. We don’t have a specific box to fulfill. We have a business with zero delinquencies and zero defaults due to a common sense approach when negotiating with our borrowers.

Why is keeping close relationships so important to A&S? How can it help in such turbulent times?

Keeping close relationships to our clients is the most important task we’ve ever had. When we started in 2017, we came from real estate, not finance. We understand the challenges real estate operators face. So when we founded A&S, we wanted to create a company that would really help operators reach their goals in the easiest way possibl. The only way of doing that is through creating close relationships, understanding our borrowers and what they’re doing with each property and each project. This makes a world of difference. For instance, when interest rates began to rise, this directly affected our capital structure. We had a lot of loans in our pipeline. We called each and every one of our borrowers and explained the situation to them. We gave our word that we were going to close, but that we have to change the terms. And they understood, because we had their backs before.

What are some good methods you use to maintain such close relationships?

Be real! There’s no method, just talk to your clients, call them once in a while and ask how they’re doing. We wouldn’t do business with anyone we wouldn't sit and have dinner with.