American Advisors Group announced the opening of a new standalone operations center in Austin, Texas, as the reverse mortgage giant continues a recent expansion push.
The Orange, Calif.-based company will use its Lone Star State location for loan processing and customer service, along with production operations associated with national field sales.
AAG embarked on a two-year search for its first major satellite home in the summer of 2015, employing a third-party site selection firm to narrow down a list of 822 potential locations. The company was looking for a complicated mix of labor availability, local tax policy, economic incentives, and proximity to airports that service major markets such as New York, Los Angeles, and Atlanta.
Austin emerged as the winner, and AAG sent its first group of employees to the Texas capital in January. The 25,000-square-foot facility currently houses 25 workers, with an additional 150 new hires expected.
“As a fast-growing company, we were seeking a location that provided long-term scalability for future growth,” AAG’s chief sales officer Paul Fiore said in a statement. “The community needed to be desirable enough to attract top talent, but also centralized and highly accessible. Austin has all this, as well as many similarities to our headquarters location, which creates a nice cultural synergy.”
The number-one reverse mortgage lender by volume also positioned its Austin expansion as a failsafe against natural disasters or other potential disruptions to its operations at its Southern California headquarters.
“Our priority is funding our customers’ loans,” said chief information officer Michael Josephs. “If we have an event or a natural disaster in another location and have to be down for any length of time, the Austin location provides continuity of business operations, minimizing impact to our customers.”
The company also pointed to favorable demographics, with the third-largest population of older Americans and third-highest total of Home Equity Conversion Mortgages; through July, lenders had generated 2,432 HECMs in Texas, according to Reverse Market Insight, for a gain of 12.3% from the same time last year. Those numbers put Texas in third place behind California and Florida.
Interestingly, reverse mortgages became legal in Texas much later than the rest of the nation due to the state’s unique homestead laws; the Texas reverse mortgage industry recently celebrated 10 years without an enforcement action.
AAG has made several expansion moves over the last few months, quietly rolling out a real estate brokerage arm and a forward mortgage division. Founder and CEO Reza Jahangiri commented that he wants the company to become “agnostic from a product standpoint” in a recent article in the Orange County Register.
“We want to be more of a solutions business versus a single-product business,” he told the paper.
Written by Alex Spanko