CIVIC Financial Services LLC (CIVIC) has a new parent company in a deal its president says was truly a boon for all parties.

“The win-win moniker is grossly overused and overstated. But, God as my witness, this is one of those deals where each of the three parties won,” CIVIC President William J. Tessar told Private Lender in an interview.

Pacific Western Bank purchased CIVIC from Wedgewood LLC for an undisclosed sum. The deal closed Feb. 1.

Based in Redondo Beach, Calif., CIVIC is a leading institutional private lender, specializing in originating residential business-purpose loans (BPLs).

CIVIC was founded in 2014 through a partnership between Wedgewood and one of its subsidiaries to serve investors who did not fit within traditional real estate lending criteria. It will operate as a wholly owned subsidiary of PacWest Bancorp. Tessar will continue to serve as CIVIC’s president, and CIVIC’s entire leadership team and staff remain onboard.

Through the acquisition, Tessar said Pacific Western Bank will be able to deploy cash reserves for an attractive return through CIVIC’s products. With Pacific Western Bank’s backing, CIVIC will have “an opportunity to go back into the marketplace and come in with a sharper price while still protecting very healthy margins that allow us to reinvest back in the business for our products and our people,” he said. “With a strong capital base, we have the ability to continue to invest in scaling our infrastructure and operations and expand into new markets.”

Meanwhile, seller Wedgewood “got an incredible return on their investment — and they deserve it,” Tessar said. “They took the risk up front, and they let us scale the business, and they deserve every dollar they got.”

The acquisition advances Pacific Western Bank’s strategy to expand its lending portfolio and diversify its revenue streams.

“We believe there is growth and earning potential in the residential BPL space,” said Pacific Western Bank President and CEO Matt Wagner. “This acquisition opens the door for us to grow in the private lending space with a proven market leader, creating value for both of our organizations.”

Since its inception, CIVIC has funded more than 10,000 loans to real estate investors for more than $4.4 billion. In 2020, the company funded more than $1 billion amidst a pandemic that caused other private lenders to pause operations or exit the market. This year, the company’s goal is $1.8 billion.

CIVIC has received several awards for being one of the best places to work in the financial industry. Tessar said the company’s investment in its workforce will not change, and the company will continue its ongoing search for quality originators.

The deal materialized through a longstanding relationship between Pacific Western Bank and Wedgewood, Tessar said. The companies reconnected during the pandemic in 2020 and saw that an acquisition would benefit all three parties. Talks began in earnest last August, Tessar said, and were able to advance quickly: “It was just one of those situations where everyone was rowing in the same direction. It was a neat thing to see.”

Evercore acted as the exclusive financial advisor to Wedgewood in connection with the sale of CIVIC to Pacific Western Bank. CIVIC was represented by Sheppard Mullin law firm.