Prudential’s Transition from Twardock to Durning Has Deep Roots
- Dec 18, 2012
Yesterday’s announcement that Prudential Mortgage Capital Co. president David Twardock will retire in April, to be succeeded by David Durning, currently senior managing director and the company’s head of originations, is obviously big news, coming as it does from such a CRE lending powerhouse.
What might not be immediately apparent is how this transition is based in Twardock’s long-time emphasis on developing talent within the Prudential organization. Though neither Twardock nor Durning was available for interviews as of press time, it’s possible to see how the roots of this succession go back more than 20 years.
A profile of Twardock in the November 2010 issue of Commercial Property Executive noted that he saw the company’s then-ongoing expansion of its loan servicing business, especially its special servicing team, as a signal learning opportunity, particularly for more junior staff.
“Special servicing is a great training ground for younger professionals,” he said. Because of the long CRE growth streak, Twardock said, “People can go through half their careers without seeing a problem.” To truly understand the business, he contended, a loan officer has to understand “what this stuff looks like when it goes bad.”
At a decisive point in Durning’s early career at Prudential, Twardock’s mentoring played a crucial role. After Durning graduated from Harvard Business School, he joined Pru in 1988 and worked for about 18 months as an investment analyst in Prudential Mortgage Capital’s Boston office.
This initial assignment, however, coincided with a recession, and one day Twardock told Durning privately that Prudential had decided to close the office. Though the flip side was a chance for the younger man to work in loan originations and workouts in Prudential’s New York office, leaving Boston was complicated by the career of Durning’s wife, Catherine, who was practicing law there.
Twardock’s heads-up gave both Durnings to make a smooth professional and geographic transition. “I was greatly appreciative,” Durning said, “because it allowed me to have some control over my life” by making it possible for his wife to get a new job in the New York area.
Once he steps up in April, Durning will have substantial shoes to fill. Despite the recession, Prudential Mortgage Capital under Twardock’s leadership has introduced several new initiatives.
In September 2009, for example, the company formally launched a lending operation in Japan, a contrarian move at a time when many institutional players had recently exited that market.
Tomoyuki Ishikawa, head of Prudential Mortgage Capital’s Tokyo office, noted at the time that the enterprise addressed a significant gap in Japan’s real estate capital markets. By offering long-term, fixed-rate financing to investors, Prudential provided an alternative to the short-term, floating-rate debt more commonly available in Japan.
In April 2010, Prudential Mortgage Capital closed its first loan in Japan, a $46 million financing package for an affiliate of Mitsubishi Corp., secured by five logistics buildings, mostly in Tokyo.
That same month, Prudential launched Agency Gateway, a short-term lending program designed for properties that are not yet eligible for permanent financing from a government-sponsored enterprise. The program was designed to provide loans of $5 million to $25 million to properties that are newly completed or renovated, but have yet to reach stabilized occupancy.
In addition to his MBA from Harvard, Durning has a bachelor’s degree from Middlebury College and holds the Chartered Financial Analyst designation. Before joining Prudential, he was a lending officer at Chemical Bank and a corporate finance associate at Shearson Lehman.
In addition to his role at Prudential Mortgage Capital, Durning is a member of the Prudential Investment Management Investment Committee and serves on the executive board of the National Multifamily Housing Council. He is a former vice chair of the Fannie Mae DUS Advisory Council and is a member of the Urban Land Institute and of the Association for Investment Management and Research.
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