Ira Zlotowitz has left Eastern Union to launch a new startup that he expects will disrupt the approach to financing and the commercial real estate mortgage brokerage industry.
The founder and CEO of the new startup, Gparency, says it would allow landlords and developers to engage directly with banks without the need for a broker.
Ira Zlotowitz has raised the largest seed round in the commercial market, $15 million in venture-backed investments from over 125 real estate experts and strategic partners (including Customers Bank).
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Gparency’s new direct-to-bank approach for the mortgage sector, taking into account both the basic interests of the banks and the borrowers they service. This concept empowers borrowers by providing them with transparency, technology as well as expert advice from top real estate finance professionals.
“After studying the commercial mortgage market, we saw that 20% of borrowers exclusively use brokers, while 80% want to work directly with banks. Many think that broker fee structures for larger deals needed to be changed. This is exactly what we are doing at Gparency ,” said Zlotowitz.
Gparency’s pricing structure is straightforward, open, and unambiguous. The new game-changing pricing model and strategy allows a banking team of financing coordinators to underwrite, shop, and negotiate term sheets for a $5,000 flat fee. Following the execution of the term sheet, the client will have the option of continuing directly with the bank or working with Gparency for $500 per hour, up to a maximum of 30 hours. “This will be similar to the charging approach employed by lawyers and accountants,” Zlotowitz remarked.
Zlotowitz, who just left Eastern Union, which he founded in 2001, was formerly a partner at Meridian Capital. Throughout his career, he has financed more than $50 billion. Gparency will have 25 analysts, underwriters, researchers, software engineers, and debt & equity specialists on board when it launches, and Zlotowitz anticipates rapid expansion. “My next steps will be to hire a CTO, as well as additional software engineers and underwriters,” he said.
In the future, Gparency will offer clients long-term plans that will supply all data and tools directly to them via a subscription-based service called Landscape. Clients will be able to view maps with parcels displaying public information, banking information, and access to all sales brokers in real time, transforming Gparency ‘s distinguishing technology into one that is client-facing.
