Walker & Dunlop to Acquire Johnson Capital

Commercial real estate lender Walker & Dunlop has agreed to acquire Johnson Capital's loan origination and servicing platform.

As part of this transaction, Walker & Dunlop will add $590 million in HUD servicing to its $40 billion servicing portfolio when this deal closes at the beginning of November, according to a press release.

Johnson Capital originated $1.3 billion in commercial loans on average over the past three years. Additionally, as a correspondent to Walker & Dunlop, Johnson Capital has sourced billions of dollars of Fannie Mae DUS loans.

Terms of the cash and stock transaction were undisclosed. Walker & Dunlop in Bethesda, Md., expects the transaction to be accretive beginning in 2015.

Willy Walker, chairman and chief executive officer of Walker & Dunlop, said adding the origination capabilities of Johnson Capital is both "timely and strategic" as he projects commercial loan refinancing volumes will grow more than 70% next year.

"Johnson Capital has a significant origination presence in the West and Southwest and will grow Walker & Dunlop's brokered originations with life insurance companies, banks and CMBS conduits dramatically," Walker said in the release.

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