- Earnings call transcript Q3 2022

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Kelsey Duffey

Good morning. I'm Kelsey Duffey, Senior Vice President of Investor Relations at Walker & Dunlop and I would like to welcome you to Walker & Dunlop's Third Quarter 2022 Earnings Conference Call and Webcast. Hosting the call today is Willy Walker, Walker & Dunlop Chairman and CEO. He is joined by Greg Florkowski, Executive Vice President and CFO. Today's webcast is being recorded and a replay will be available via webcast on our Investor Relations section of our website. participants line placed questions will presentation. all mode, a following time, the and be this have in been listen-only the At for your Instructions] release our Investor [Operator section we to Relations website. presentation the earnings our of morning, This and posted reference a during Willy on for some call. as and serve of will Greg slides point These touch the what share financial call. and adjusted EBITDA also that note adjusted this we Please of earnings will during per metrics, course reference the non-GAAP the diluted earnings the presentation a Please refer of to metric. appendix these of financial for non-GAAP the reconciliation Investors statements are release. the urged to carefully language read forward-looking earnings in our Statements which meaning maybe of on Act not the deemed Securities Private historical Litigation Reform made facts, this call, the of within forward-looking statements XXXX. are

disclaim differ factors update over & obligation result the detailed or statements will under to no alter expressly is or of materially. filed events with turn do Walker SEC. whether Forward-looking we found obligation current and reports new results our Willy. More describe annual call as to the be Dunlop our can otherwise. forward-looking now so. any quarterly And expectations our statements, and risk to I future about a information, information may in actual

Willy Walker

rates changes, a And continue is in morning Dunlop of amazing good the to you, housing times boom of with W&T our great needed be along management provide market which fees HUD use adjust Kelsey, and I've consistent model, asset Fannie exceptional escrow do. sheet credit challenging this our we during dramatic the service partnerships our financial our expand the with to for during the company two, years. culture W&D with expands Thank lot, in countercyclical and new people, our outperformed shareholders we pandemic. growing. and adversity, allow of as down a Freddie and much contract clients been confident Number number balance three with XX administrations, technology while own lending a CEO us quarter. business three, should and watched billion years. as thanks things; loans deal Walker everyone. regulatory Mac income was I've of consistently others strong originate, I've capital that in to coming volume months & bust, very delivered seen rise crisis, $XX includes scaled and markets. as clients our one, Mae, brand our will number And third well and disciplined and on volatile servicing everything total has and over dislocation. transaction

in sale a in this of XXX year. lending To pressure. our year, a clients. was clients' needs. When Fed non-cash our income. Mac basis of in due increases with decline our average a every XXX abate news, underscore normalize quarter rate net flooded We the basis have growth revenue than are is to and margin continue of lot pricing low That rate deals exceptional is for evolve quarter make margin should to solutions when steep XX%. during interest in generated XX. continue we QX. a and the the rights and sale on closed and pressure on clients, Good year Fannie this competitor points, news, last else in firm pricing saw rates points a of and over rates team to Mae better work we lending our financing gain our mortgage servicing prices no down drive agency maintain than on Freddie dramatic Bad sale at coming our points. to and were will QX average point to every capital agency spreads towards quarters, industry meet on whether need Spreads XX-year under was moment rate the total gain adjust the as our anyone and increases transaction to greater our the stops markets our withdrew volume billion QX from with $XX our compressed tight jumping the treasury positioned providing are X% In any on will work sale our $XXX refinancing how spreads competitors compression on in and our plan gain average but or QX environment, five-year margin down only the investing we million, markets due This deal last we to over This is of closely revenues lending rising pricing insight competitors at XXX stabilize. total basis recover. solely meeting, will it to remain

partnerships see the quarter. enduring with the is countercyclical the GSEs volume and Mae provided market And you on volume keeping Fannie multifamily on billion Fannie during as Fannie's comments pricing scaled to win. $XX lending deals on Year-to-date can to market partner Our Mac capital is XX% to track Two us billion. much $X and largest with share, Freddie with additional slide needed be lending X, of Mae once again.

QX as we to basis fees servicing than servicing had billion points basis points, in average $X.X new increased of payoffs servicing added. First, XX.X average the lower fee we loans and our from the XX.X to added portfolio loans

fees. we Second, our servicing paid via for get risk our

reflective to We on are historic of the numbers out was Cash QX. and fees correspond adjusted The model. and And of in expanded we in EPS, X% averages. quality which grow good up loans capitalized year-over-year, weighted earnings and Adjusted to we in should impact customer last W&D's down to up So, million, average strips $X.XX. credit revert from rates lower fees as stabilize, extremely value to our service soon $XX as originated risk. MSRs to QX servicing continued hopefully was XX%, loan loans, tighter delivered noncash revenues to servicing the about risk-sharing the EBITDA business year. would terrific QX. while X% These items, feel XX%

Group $X market QX, sales down debt property quarter, of our sales our multifamily in our as pulled billion These volume. the markets. in Capital As of fell billion to and and surprisingly from brokerage for to Similarly, of of $X.X debt team out only deliver precipitously bankers our banks, numbers challenging Markets to QX published had our X% exceptional closed for with comparison volumes funds clients according off RCA, brokers CMBS a volume, truly ability in the strong last XX% are and lenders show year. competitors numbers

QX, about our continue team's XXXX. very of good these ability in growing but feel market share We expect to to see softening in in both executions

past new All is customer & of in recommend QX. The XXX The of positive our is, Promoter answer Score Dullop's relevant According Net most to to XXX in or affordable transaction Net teams a to exceptionally use determine service both to your in level that identify in new loans technology, is we on and new three beyond & Dunlop. or well the strategy, total speaks research, excel housing, were & volume Net consistent product two the lending our or headwinds largest about services our term this Xx built Rising Score. with Bain Dunlop rates of to years. contributed QX, our models, always service budget negative the to rather W&D's perform Promoter the you ever to in such that business & was We forward. us Score over a would balance and are of clients. businesses XX% question focused vision, to balance enduring service markets. cyclical, and M&A Alliant, recent Walker acquisitions it the And of scale to is technology pro short Walker Promoter technology Walker lending the in and operations, growth and of not bad major our our continue acquisitions over business friend. and appraisal for service, complementary financial for bank use small we've XXXX. our our economic as may position and GeoPhy, XXXX average good refinancings question were small on but clients and for investment industry providing continue & outperform Company, is volumes curtail $XX XX. volumes attract going XX% In is Zelman to expanding XXXX QX Walker on Dunlop's clients businesses. to And in brokering that appraisals but made exceptional nearly million acquired revenues customer two XX and Hindsight the accelerating average. largest

excited get investments these growth. of All us about W&D's future very

are XXXX hit, Escrows rates once the the the losses. prepayment the million of we in the is and as quarter. rise. and over no, Today, explain billion, in Our grew would of XXXX in and servicing no, inside X% in our as and significant that concern look fees answer crisis moment, more servicing was at portfolio our income to an asset pandemic loan portfolio the financial QX credit, Greg $XXX credit of fundamentals The culture first suffer more as to and our great again. portfolio of earn class. a XX% on will due and strength answer protected, W&D W&D's When generated the multifamily, XXXX was portfolio $XX multifamily up as

discipline. team book. clean exceedingly an and have We our Thanks credit to

asset estate office, credit exposure classes. no other real commercial retail have We to or

at no risk the construction service make servicing CLO weighted on credit carry debt average our in credit any loans currently at-risk nor sits have We on and ratio not did risk We loans. portfolio times. X.XX coverage

Let that context. me put into

loans not coverage beyond. to discuss XXXX now I'll call X.XX financial in new the service outlook debt concern. is currently QX turn detail, will then I times minimum and the ratio Our about come with sits and is thoughts credit more X.XX and to portfolio back Greg on our at Greg? over times and a results overall

Greg Florkowski

Thank you, everyone. morning Willy, good and

of quarter revenues million, billion quarter year. third diluted generated $XX earnings XX% to $XXX compared of last of the last down down and share this from of year, transaction total per X% Our $X.XX, volumes

MSR The nearly and described, respectively. pricing XX% our XX%, in ranges our decrease result spread margins MSR return operating Mae despite at a of revenues the XX% As revenues and fall Fannie target and our volumes. flat equity below Willy dropped caused to dynamics, just on non-cash

In closing this when they works Our needed them. navigating on includes most. quarter, able we deal for value to our the and that markets clients for our proposition were us clients deliver behalf challenging of

this our and which long-term our Importantly, again increases $XXX servicing occurred yet revenues, stable portfolio our agency cash grows lending million. portfolio quarter, to as the servicing increased

increases our a benefit of in our of short-term As EBITDA servicing to cash X% Sharp X% revenues $XX but our million, $X.XX dramatically billion $X per escrow expanded transaction growth A is earnings and disrupted portfolio earnings. in grew our further increased earnings drove volumes, rates share adjusted adjusted and quarter. result, to we this escrow hold. at

escrow This compared quarter in $XX earnings $X increased year to to only XXX% ago million, nearly quarter. the million

we results into to growth provide adjusted of the made highlighting of and benefit assets businesses management to the in of of and acquisitions performance. contributor EPS first generated and is the these the this under primarily introduced structure cash Zelman. EBITDA In quarter the more combined and Zelman, adjusted revenues revenues basis, transparency subscription operating stable Another financial XXXX, On quarter, Alliant. in $XX million of our investments we a overall the financial nearly at Alliant segment

year. fell Slide produce on lower transaction-related of last revenues segment for $XXX Expenses million segment transaction-related this segment, quarter, down commissions drives transaction segment, more for Markets compensation As the Capital revenues which of compared revenues, adjusted of breakeven volumes, declines due shown for to EBITDA mitigating rest variable from the little this largely XX% are costs quarter. generated X%, this this expected in which X, to helped XX% year. A variable the for lower than our

and confident executions We will sales of the banks pressure debt pull HUD deliver will to teams our to and due brokerage team countercyclical recognize capital, the continue and as other back. property face but nature GSE our strong are from volumes liquidity

this our long-term markets and will capital making despite unchanged objectives investments the for to long-term our segment. growth team for sustain continue headwinds, Our outlook remains we

activities businesses. management asset SAM of the Our our segment servicing and includes performance

earnings As this revenues for within in or quarter, segment income are revenues and $XX growing. escrow shown Alliant. SAM revenues The growth revenues EBITDA. on fees, XX% in generated grew and Slide growth our SAM from million operating resilient The our X, adjusted due growth segment XX% to XX% servicing and increased in

million $XXX protected Our the loan revenues servicing the recurring duration portfolio over generating and of is portfolio of nearly is nine annual prepayment years.

earned billion grow under management million $XX as year-to-date. to strategy management long-term our Our of paying revenues under assets is our dividends, of assets $XX

increase escrow and to continue and continue and Lastly, drive growth other will EBITDA. short-term to cash rates interest income adjusted in

the also business expense. represents of G&A segment and corporate our includes our debt Corporate corporate Our

loss increased on the downward to for As down the net or Total segment equity Those by to quarter. million our we I'll revised decreased were offset this expense Slide $X.X downward performance-based X, company for XX% our and X% as made borrowings few EBITDA while things debt shown moment. XXXX, from our accruals compensation ago corporate adjustments costs the A adjusted as on interest $XX this $X.X is to highlight. bonus which quarter, our a a on million, explain increase million in were outlook in revisions indexed quarter SOFR. term year

benefit which effective tax ranges liabilities intellectual reduction the remained also our consolidated was next normal tax tax experiencing this we approximately our and level we diluted margin but reduced acquired During rate the and quarter. XX% repatriated the earlier entity XX% its and of of or million equity one-time rate future XX%, largely year. due of and overall operating about target Year-to-date, $X.XX on revenues in annual an of the The this XX% were XX% to restructuring effective the from change total at began in return property EPS, This impact to legal our volume up non-cash declines about GeoPhy quarter quarter. was return transaction $X quarter. in restructured annual below our respectively, a will second of to which organizational

compared XX% even the year-to-date up diluted market EPS down year. reflecting slow as to is $X.XX, ability same business' the last period our is adjusted to Year-to-date EPS generate Our down. XX%, cash transaction

a fears XX and impacted transaction the recession of servicing and on fees days to levels. Over lower last loans volumes in at rapid remain rates increases interest new global caused

and of to loans rates rebound sales and interest at rest fees new current stabilize. transaction servicing do levels for brokered not investment on expect at we executions least activity to for XXXX, We remain the expect our until

XX% shown on XX, we be line EPS as percentage down are year. year-to-date year. of slide will is XX% Notably, this with and revenue in XX% As last projecting now diluted personnel expense a between

growth in the in in that high-single-digits. Our with decline And with adjusted transaction EBITDA in will coupled we downward will our variable quarter. line in asset of us adjust that any costs the servicing and management revenues fourth strength confidence the give to deliver and revenues, XXXX mid

We margin end targets, adjustments the to operating to perform making the expect or are our any not at but ROE of lower ranges.

costs our year. transaction As been on we look ahead, actively based we largely and reviewed our not These expenses for slower be costs until have G&A will our year. volumes most and will impact next realized outlook operating next reducing reductions

curtailed immediately backfilling significantly We reducing selectively we are hires, more becomes our not and planned have headcount, positions. new but

top of slide XX, As wide of the per efficient see on you annualized we can our generating margin. group employee, at a by over an operate $XXX,XXX business, peer revenue

expense for any in naturally compensation are causing of variable, adjust to half revenues. declines transaction costs compensation over Importantly, our downward

our reducing believe head share coming on we to people of invest continue end take line model business quarter of outlined. business that We prioritized transaction quarter the $XXX Promoter as us, not and purchase and not in advantage when investing on with opportunity business, balance down capital, quality months, and culture count growing our in debt, grow the Net the to We reflected to and Score, only We on us and in in intend our we principal allow cash QX. the teams, sales countercyclical XXXX. used the co-investments market We in believe million a and management in Alliant. fund this by but under our the ended rebound new access Willy service property people volumes do the with disrupt that bring in our obligations service asset are fund agreement third of to capital pay to business our of differentiate three outstanding to the sheet with

opportunities repurchase nearly not a did our of invest cash maintain business the number strong $XX we shares. desire back the to this quarter million to balance, Given and into

a share XX, business. approved November invest shareholders of continue our We generate operations yesterday, a of And of fund to $X.XX again record quarter, this as Board cash our and the per to XXXX. payable in to healthy dividend amount of

like million shareholders term We several We faced will we to operating have lower ROE with lower servicing operating volumes. this combination prioritize returned loans repurchases business. and the nearly and capital year, our margin share in fees of and diluted and of metrics the will EPS, dividends, to of transaction investments $XXX near through a in closely under on continue backdrop to a remain due macro and pressure new challenging this

in ability not generate to Our adjusted the tied EBITDA cash markets. to and lower is transaction growth to

servicing annuity-like shown fully provides of rate million hedged And flows. Our XX, earnings $XXX slide over on are as cash portfolio debt. and escrow our our floating growing

has our than annualized $XXX $XX $XX annualized income. million Fed rate reached expense As in operating offsetting and million escrow million between debt funds $XXX more now providing and increases earnings will revenues, of generate of million X%, between floating and

We balance position. a corporate also have $XXX of a to we healthy maintain and cash million continue strong debt with sheet

declined Our EBITDA. from X.X times to growth corporate the just in today, continued to at from largely over adjusted has year-end X times debt EBITDA adjusted

platform, over that now to uncertain focused macro We will growth. have despite continue create while operate environment. in profitable investing long-term business a resilient to flow, diversified call managing back costs and efficient will Willy. strong remain to turn the We to cash on our model business generate the an I

Willy Walker

Greg. up & generates down cash model strong exceptional Dunlop's you, business Walker markets. and Thank in flows

pandemic, and to wildly countercyclical business GFC credit overreaction the due after to of focused out coming performance our disciplined and capital, the competition culture. at initial access model outperformed back look W&D our you market If

just have Greg servicing $XXX a see it sit the & appraisals, see billion why Walker while achieving and at And and revenue billion on XXXX the XXXX, annualized this Can this And XXXX, and of currently And over Fed environment anniversary, strategy in quickly debt sales, and with Add mortgage and our JV $XXX dramatically $XX that brokerage rate of after capital, as you billion small as and months. shown share the a market plan. hit the but financing? servicing XXXX, area rights and & debt recession to countercyclical banking, $XX industry. had and funds of asset W&D $XX building again rate Reaching take and businesses. leader off how our to higher equity to than many Even XXXX, market higher interest we in us And banking billion zero, get the and years billion financing in come made housing. also brokers making business, which streams the W&D dislocated, of since not the in time sell platform workforce last forward share. lending, surpassed four past equity, competitive by debt bigger reiterate revenues we at property providers confidence conjunction we to moved growth When the environment, is escrow, current we XXXX, Wells blue, to Dunlop's in is will provider growth of to Remember significant pressured $X I we at provided management sidelines, than mentioned, center. when balance trust investments my business of $X This in cash escrow that asset The servicing investment so $XX with debt high-margin brokerage the on we've S&P, in the stickier investments in revenues the unlike joined liquidity our when much Walker will our originators, JPMorgan in rebounded and our accelerate MSRs XXXX $XX to of look market of our XX first We've mortgage needed for started powerful. in businesses in lower drive increased new due multifamily highly to research while billion the get affordable and largest harder rate Dunlop loans target environment, model that competition. push higher market XXXX to will get in great and equity quarters. W&D to aftermath multifamily and adds needed portfolio. of preferred normalized its dark services existing in is continue XX you affordable five-year with only recovered XXXX was fast generated potential affordable getting a focused the XX deserted. our generating revenue in and elevated our and our slide and a is our and If balances. the Alliant Fargo achievable. the billion. & competitors access bankers a in GAAP Then income investment in times over and done servicing Walker and portfolio XX over we $XX in done When management million XXth billion return to EPS durable the non-cash we a W&D is was scale is portfolio capital modeling. landscape this on servicing and Yesterday, celebrated market revenue Dunlop rate uncle company. fees grandfather the you QX. due when in was Today when which front the CRE, long-term housing

performs it lived capital, open the through well our economic clear I made reiterate us positioned. which current access that visionary continue weather clients' call. of provide headwinds, W&D corporate people, we exceptionally meeting business conservative And Walker to both opportunity. in down our is needs. points positions structure up countercyclical and as of and technology cycles and markets. in to I to times has debt and lending will us tried would very are world many over throughout. call very brand the continue And will with well W&D our three uncertainty for now this at and investors. W&D's & we My our has to class, with to for We Kelsey allow questions. will all turn our leadership is have I consistent the clients, weathered line and open W&D. cycles to winning economic Dunlop's those partners family the

Operator

The line from first Instructions] now open is [Operator Jade? question at is KBW. for Rahmani coming Jade Our questions.

Willy Walker

Jade, we can't hear, you are mute. Still nothing, Jade.

I think Try you just Jade. came through, now.

Jade Rahmani

you very Thank much.

that. about Sorry

Willy Walker

It's Yeah. okay.

Jade Rahmani

On the how fourth transaction the on was volume if in performance give trending. I could update quarter. outlook are quite impressive wondering, you quarter any things

in You you Fannie also Mae And The were than much were they strong. things extremely were said X% to seen we've pick up year-on-year. don't broker elsewhere of stronger particular some performance expect up. volumes the loan volumes

two those items any could on you line maybe Just comments? provide

Willy Walker

all, for Jade, of volume explicit this first of all, First thanks guidance not for morning. QX. we're us – joining giving look It's

releases a relationships And bit sales than QX the to still underscored QX previously clients. stronger any to think There's carryover volumes I team, speaks that, on. competition would quite were side. into their said earnings this our and QX on transaction investment volumes. of I've of the I QX and from you relevance say, on I As that read our as

down as significantly my happen. -- sales said are of in so The I replenishment has is slowed the the question will if the still you seeing pipeline and real And comments. that we

price was beginning are many focused into of and as strong is on and a group market, no lot the agencies win process agency will capital financing Mae get next that they to Mac I Freddie to And a market Mac generally won to that in then market weeks in November, stepped Freddie very for right over XXXX. lane of where deals those relates October brokers Fannie opens the business into the in bankers back that think a couple deals into business And it the the of that longer of then seeing very step point past On to would we're the in now. and what weeks. can several win. and pricing side, the to

relationships the you valuable and they And going well have right as dominating the into are very will are us. with scaled past Freddie to our know as lending And they and XXXX. so very as now, in Fannie likely market do they

Jade Rahmani

very And were definitely of the the model. you Thank sale I on that one gain we could a headed? thereabouts. you in be that's again versus sale believe have could gain to margins hopeful big July think been directionality trough case in expect you our when there the any margins you on margin that much. variances give still where you on on met, Do And was

Willy Walker

rates move the going I Yeah, to up be fall, and back trough work had pricing them a would looking did going when was XX on of on pricing that, hopeful the indicative get borrowers month to sudden it And the basis X.XX. quote back if the and let's at sudden X.XX things we think of express back honestly base if we for by by come to to New situation was XX-year inflation rate. XX we're basis a Fed you the did it meet in here York that early were where you in about to points basically raising that print Jade put say late summer points I we now got that all saw to back hit the and a We've XXX. a rate the all another And we that because back deal our up and at a pricing coupon treasury. to that Quite we right out. that was,

our of our and we and at sit And Mae Fannie so GeoPhy the and and that deal would look work. there type make

the driven. to It's this underscore in that as not pressure just prepared pricing of any driven. the and I the we widen. obviously guarantee type I normalizing price spreads will competitive of line we stabilization as to will noncash right see would is it now. dealing will back relates is think result what rate said see And Fed, so both I And are ability I right with revenues all we income. once landscape which servicing mortgage item think remarks, type that my that's And help which that, get a of we from fees, to net

Jade Rahmani

much. you very Thank

Willy Walker

Thank you.

Greg Florkowski

Thanks, Jade.

Operator

you, Thank Jade.

is question Steve JMP. next Steve? at from Our Delaney

Steve Delaney

think for Good were remarkable transaction given on pretty the morning been question. topline everyone. you what volume single-digits revenues the but in we've Willy year-over-year I down, a through. and Thank basis a high taking

transactions I a to -- loans. fixed the rate doing respect have you with think business customers and we know your their rate-driven for XX-year demand

there's properties. I some we Given are, borrowers' with disrupted business your where assume plans

your bridge this might to loans with opportunity but extension it not relationship as WD is essentially closed possibly lending Given include to step it's be. and agencies, well market your CLO is business expand the in the -- for an

So, Is lending for that all specifically rates Freddie in the that cetera Thank are that of short-term you they're next position mortgage long-term Mac step have a expand of a Could not you high to be -- has get to lending? this And are reducing when capital. as Q-series REITs over in part that three area strategy demand to program quarters, two trying reactivate. opportunity. to part you. commercial or et the an see where

Willy Walker

a really question. and Sure good Steve insightful and

a of couple through talk mentioned that there. things you me Let

in first the QX, of customers. thing and & we our relevance show strength to with our underscore saw the Dunlop is volumes would that The I Walker the relationship

said, Greg relevance our I more volumes as to our never while been significant. clients QX has have in and may so come down And both

say has is with We rate with some are had right some a now. people engaged just then you -- people sheet. in given movements. on add refinancing that a changed do has a many rates are. doing regardless We're plan dealing their a to what where driven portfolio and business exactly clients put lot business many, try who isn't pace, capital plan and to say -- that outlined to I cash-out my That of want balance of It's which whole dramatically that some cap are sell

sell go Let's it.

of point. on raise this at lot And so people we're doing want and to a transact capital BOVs potentially who

do to understanding call know about it and Your in Steve is on to $X about. billion point CLO series, what talking may those and is Q To that Freddie of not relates who are as loans QX. Freddie going the Q the my I the market

Mac be series. back stuck on If you the were you and and lines securitize back what series became through go Q if able called their Freddie went loans to up to and significantly warehouse XXXX very being now would the those buy and are that will timeframe, K clock

of as some Freddie loans sell of on had the loans have who may been hung you have into to firms lines competitor prepared a loans sort sheet. exposure of not Qs. a my remarks, I number that in those We, have of and that our balance do to no have on And heard we we Mac looking warehouse do hung credit have said, our loans CLO any CLO said quite few With loans. Steve,

sit have in with our Blackstone. We loans that joint venture

not balance to sheet may do opportunistic as as on that to same are, relates also that cash us so balance Walker this and to say be to And balance who it both may capital focused create as teams may is platform with use to Q sheet liquidity the step need we Greg a our to on through loans Dunlop. I key clients very only capital that opportunities any time, help & in time, And the our not would maintaining & our at the additional for something be that Walker on at those stable execution shareholders same dividend something a our them. payment said, Dunlop. at come along returning for M&A But any and of some be to

We that our with I do and needed history would a if that we in think when doing that our And client it's and partnerships. of of heartbeat largest record by clients. would some a track have

Steve Delaney

going Your last like -- corporate next that through comment of for tied question that kind but the tough in directly casualties. markets, period? you grow to not this We're my second your year shakeout business and of there what most wishing would part over casualties where we're to period opportunistically transition some are usually these in

Willy Walker

did So, not we acquisitions and -- I XXXX made fact would the make underscore in procyclical we that XXXX.

really gone did volumes about robust firm that out and on a volumes We sales for -- at We not are because Alliant it's a acquire It not meeting from to to nothing. XXXX. both have budget out business mortgage think and a have Board that did gone robust and our talked the says ton I Zelman we it about go brokerage fact buy big investment nothing. from go yesterday.

fare well when has we've origination So, other that crisis, out buy of I platforms to clearly, very in acquisition the in Capital go CW our market And XXXX dislocated. streams whether past, financial the revenue extremely given us long-term and do, when good don't about platforms do be feel we you've opportunistic the as ours as consistent of discipline as been coming great M&A from an it and the And standpoint. seen earnings have. the

so we'll looking. be And

and other in at to two scaled brokerage be Buying and But took was it though, push XXXX. talent it disaster for in at challenging an to acquisition in we've resource we relationships. know, But acquisition, who turned on unmitigated JLL who their any management. It concerned and think since would because it people to size, about be mortgage on HFF. capital and JLL, listening underscore this. to out deal acquisitions The I to and many the done together, the CW -- as I our platforms mind JLL/HFF tuck-in people. human them thing major products wildly this keep brought and would sales in property haven't through are hold as HFF enterprise a companies merger lot done call for that as human an accretive investors big they to merging to relates a was of relates those this both

very cautionary, going are would relates acquisition. I large-scale doing capital-intensive other as a to then that So matters. thing that we the human and culture And it say, is on

at have that We believe unique is & distinct. a I maintained truly Walker Dunlop built and and culture

of large-scale people we'll a top to look cultures mean challenging. very that if deal? business And today. not does which human put focused wouldn't is a the would I a take large-scale at the that it's rule out, emerging that a ourselves completely but and list never is something went so, at transaction, Does susceptible probably we it, we in did it mean capital we'll do never

Steve Delaney

that our comments thank I job know panel. the Thanks. conference do you great house Thompson week. a And for we’ll representing Understand. Sheri you at Willy, next WD miss and But will affordable on our

Greg Florkowski

Thanks, Steve.

Willy Walker

Thanks, Steve.

Operator

you, Thank Steve.

comes Coffey Wedbush Our next of Securities. question Henry? from Henry

Henry Coffey

it one have for that the like Yes. your are the answer and customers Is -- I -- Good it everyone. on question. on morning, Thank taking slamming hand don't here you my sounds brakes.

On anything anybody other hand, the smells that or looks market, major around any metro walking see recession. doesn't a like

be from I going business in lending, try multifamily Trace buildings overwhelmed shifts of in election. this real So, how rapid ability by underlying I Watson is built or over just business markets whatever your much there may change to economics all in may get mind, run the reacting this much the this mean, of are again. how some And the on disruption customers related issues capital your of rent multifamily confusion or rates or to rates, [ph] it the real in hear is, changes the to quote be. perspective? some people is

Willy Walker

have you all, Henry, of to morning. first on this So great

will I'll your a Let answer couple anecdotes hopefully, -- that of question. me give you just

with they cap rates not those have all, to that of adjusted First rate movements. rate moved, have fully at rates moving the

firms, negative previous And X.XX% to were And a so many it with cap at on real right due that now, there transparency rate comfortable buying with say, I I've you in our relates of happy who no the heard a deal Jade, asked to feel as and would and going. the people time some not deal. how in where October the question X% negative November I deals up are who on frame, end are August, of people many putting acquirers leverage putting leverage September competitor debt to calls to of there negative buying rates think going leverage. are on and

billion for last that who acquired wants entire a I've three many sheet. me so the doing a As balance transaction same call that. clients of they're I'll saying anything. And And time, can't do as nothing week, two and last did told downward on And assets a them who to mention, has and spoken say, weeks just going $X up they on we're dinner received called their who we're right the "Oh, had At quite client down, that to put said, refinancing people. ago, that someone their it two it's just pressure last do to a we me multifamily result, in out there's terrible, there how wants month, doing there in and and I they cash sit now We on volumes. I are penciled cash who refinancing sell to someone, do portfolio. about talk really almost the significant through, put phone how with

this Dunlop e-mail seeing it's So is companies if are right pencils while last many to life Walker an & and clients' think all been the saying, from saying banks opportunity across wrote salespeople "I've pencils down, that I back I & for people Friday, busier. and Dunlop a bunch bankers now, you're e-mails And Walker & down pencils our needs. Dunlop meeting to in got brokers be of never up Walker insurance

right there right of the to revenues, every client valuation us refinancing properties. question because real us wants wants Every becomes the client now. be about or talk on be so scenarios. busy to wants to to running their Every making us thinking And client numbers

data a are down. to that's right thing point now borrowers other The very number the back believe in go market that going is of the who interesting rates

the cap that's putting here a on So put clients, they rates seven- three-year on my rate I XX-year point rate quotes the rent fixed ago a we XX-year have we rate, think fixed paper trying in market the all focused don't it's month going to and and conviction W&D quotes for in We fixed don't come back today, out dynamic to the but go fixed I'm a mid-Xs we forth to debt had to back financing is down. start half the they're that, Henry is going my come were rates me that back And and the at But of most rate underscore down who is rate opted put away stabilize. rather low with rate wise because Xs. fixed and come in is have rates floating off we Personally, instances there a mid-Xs to XXXX. in numerous need or back back many but my growth, rates not or locked locking period float seven and down. But going a fact the in that that would on floater than for significant debt deal just rate move a rate need to borrowers. watch is

normalized mortgage. rocket volumes a, rate we so need not transaction a fees, that to it relates MSR capital. get normal to stabilization, and we the servicing and going. is as moment now will with to lower we'll can rate environment back We up get to income and need What got happen And those lend are to have our back some we revert will net b, that income. MSRs not continue do We countercyclical capital we've have

Greg Florkowski

– And add I'll I'll on there too. just

stabilization non-multi capital markets into our soon see of as on volumes classes brings the get stabilization. back we should are as Beyond and the as there and asset well multi, seeing rebound you rate activity we plenty

So there's landscape. across opportunity the

Henry Coffey

is I the fine. think any going everybody listening there understand W&D that to history be call was just you to that

we to of a a appreciation but You I'm we balance put that, capital of of all that What business, put of have in balance price look If What go and their fundamentals do operating sheets all stuff, markets really we rate their the about terms funding aside residential aside the is with exactly home cetera. the in the the properties? people how seen are market exactly lot not terms related. June. unique if whole your you about plan Obviously, how since want of you their perspective are that's plan in We've sheet, clients, bearing et on profitability performing. business, your properties just your down what they only wondering of the business. at think

all it aside And noises push does what look so the like?

Willy Walker

back life. over loving was financed Yes. today, is that owns time that going today asset XX gotten. had Henry I the who owns of rarely who years asset last I've type the this Everyone Everyone is on performance any have sitting has an

multifamily So rising X.XX it was fantastic. that And what growth of peeling you in XXXX, in debt while, years. said, our Their there's XX none back be It's as times, to comments and refi to to as stuff of and over I relates on it times. said, of flow refinanced my one interest the do X.XX Dunlop with higher I servicing today? rate of company billion to next & this is those going the is Every rates in be a be of debt done. environment. of I that portfolio at has know $XXX plenty cash able CEO that's our ratio coverage service And had the looked to $XXX assets the million Walker every in me tried portfolio, of flow is gosh, "Oh underscore And is year servicing rent leasing to their there's levels the very I someone reporting who week lots the from call coming cash XXXX elevated fantastic. be beginning last up

a as yes the far done you floater asked unless on real pain there. and point, when said, probably I out so him there some And did be a unless, Peter by Walker a you specific be of didn't there because CLO pain? cap between. Few was he have webcast, of one QX Yes. and But went you agencies, it in on ago, put some said, opportunities? not Will a on will and it, month and XXXX the about the provider Linneman could

now be have There thing say, think we're “distressed” on the be where sidelines seeing a where active. rates to right see banks would a and here to the and I is of this people will go, adjustment that the final are back are basically will and pricing. and get the line that. bottom There someone capital, cap of sidelines. advantage can sit then the I of say to seeing people assets I I'm and take dislocation. There raise so So is And who on right now. wait market still market there rates number advantage to get who go We're just are sell taking people at clearly may do going

my Wells stay you sidelines work, are in way went of Charlie space. down that XXXX. As that taken and in again. on assumption warehouse been the loan have back be up read loans would sometime over making JPMorgan, And all get Scharf They pulled. can is January well-know capitalized. and Today ends if they come it pencils all commercial that real from will have America Bank estate significant liquidity start Jamie and of happening at They X, the Fargo, lines the loss There basically least my mid-August. no in change Dimon reserves to

we market. talked with a barely As CLO about There's market. there Steve, is CMBS no

week many calls could people at of our the So QX here's and companies we competitor Henry, forecast it earnings said, think transaction to the to rate That's our if on as stabilize any firms I you see back from you volume kind see market their is okay, nicely. come week any capital of, the a really my the strong get agencies you right and looking best-case of in see Fed a XXXX. half to the increase, type of -- numbers inflation relates before standpoint. selectively and Many a insurance to we're point clearly now that break And life debt your could -- last back on market scenario.

comment. a how XXXX. be long market. the QX supply really to does agencies to & take fair we of that's with stay Walker The is think the it reasonably capital question advantage other the will our piece and where I position Dunlop reasonably for to then dislocated market conservative the And

get life we're takes We've time One It liability conviction of history also because on you crisis the standpoint. to the look though our in not for things the time but clear from past capital that now companies for okay, again. do, the during for it's market. prepared remarks time to it's even to finished It in a our markets. banks outperform reserving say to at was completely takes afterwards time back to if we we takes it say, insurance tried where get crisis, it's we form into

of have to this we do shown and will And platform clearly so very that. that. we business positioned is advantage And single take that well just very every time our

Henry Coffey

you. Thank Okay.

Willy Walker

you. Thank

Kelsey Duffey

Henry. you Thank

We have time. further at questions no this

So remarks. the closing I will Willy turn now back for call to

Willy Walker

and feel Thank for as great joining earnings to for providing you this and are Thanks a I engaged Thank Kelsey these for capital you single the our hope customers underscored joining well-positioned your a everyone a QX. clients. us today. exceptionally fantastic for and everyone day solutions Thank Ginna all you doing capital of done Greg, on our work everyone has call. job and day. well today. us to a times, challenging and W&D every team team with we fantastic and Greg that's have I we while And both

Walker & Dunlop (WD) 9 Nov 222022 Q3 Earnings call transcript