McLEAN, VA-The multifamily finance market shifted on Friday with the announcement by Capital One that it was acquiring multifamily originator Beech Street Capital. The combined entity, when the deal is finalized in the fourth quarter of 2013, will result in the fifth largest national multifamily loan originators. From there, the company has nowhere to go up but up in this particular asset class, Rick Lyon, Head of Commercial Real Estate Banking, Capital One, tells GlobeSt.com. In short this is not an economies of scale play or a deal forged to gain operational efficiencies, he says. "For us, this is all about growth."

Indeed, Capital One and Beech Street's respective strengths are highly complementary, Beech Street founder and CEO Grace Huebscher notes. The most obvious gap Beech Street fills for Capital One, of course, is its extensive GSE and FHA lending operations. Their other product lines and geographical footprints match up well too in the commercial real estate space. "Capital One has quite a few balance sheet products -- long term and construction finance for example. Those products will be available for Beech Street customers, while our GSE and FHA platform will be made available to Beech Street customers."

Their respective customer bases also mesh well: Beech Street tends to focus on middle market companies while Capital One has gone after slightly larger sized deals and institutional borrowers. Capital One also has a very active REIT lending operation based out of its Tysons Corner, VA office, and a health care real estate lending operation that specializes in senior living and nursing homes. With their combined firepower the two companies expect to grow their client bases and originations levels.

Both Huebscher and Lyon declined to discuss specific projections or benchmarks for the combined company. When asked about which new markets the company hopes to enter, here too Lyon hedged. "There are clearly other markets we are not that strong in and would like to be and thoroughly expect to make inroads. But I hate to put a time frame on this. For me, it is about finding the right folks first and then executing seamlessly."