Cheapest personal loan-Stephen Roth - president of Secured Capital Corp - Who's Who in Commercial Real Estate: Towers of Influence

Stephen A. Roth was a pioneer in the securitization of commercial real estate in the early 1990s. These days, the 38-year-old president of Secured Capital Corp. has staked a claim on a market he thinks Wall Street won't touch.

One of Roth's specialties is securitizing high-risk, low- rated properties that the big Wall Street houses usually prefer to avoid. During the next few years, "our role in securitization will be to distribute the lower-rated or subordinate class of offerings. That is our niche in the nineties," he says.

Roth's company advises institutions on how best to sell off portfolios of problem real estate, either directly or in securitized form.

Secured Capital has packaged $6 billion of real estate loans and properties for the Resolution Trust Corp. and another $2.5 billion for a list of private-sector clients. They include First Interstate Bank, City National Bank, Pacific Mutual Life Insurance Co. and Glendale Federal Bank.

For their own account, Roth and his partners have acquired about $950 million worth of loans and real estate. Secured Capital also functions as a trading house for real estate securities.

Roth, a veteran of the trading desks at Salomon Brothers Inc. and Drexel Burnham Lambert Inc., is very familiar with securitization. In fact, he credits himself, without qualification, for "developing the secondary market for commercial mortgages and (for developing) the first commercial mortgage securitizations."

Roth's background in securities began when he was a bond trader at a Salomon Brothers office in Manhattan, where the Stanford University business school graduate bought and sold Fannie Maes and other securities based on the value of residential mortgages on behalf of clients.

In 1985, he jumped over to Drexel Burnham Lambert's Beverly Hills office, when that office was trading heavily in mortgage-backed securities. After Drexel collapsed, Roth and his former Drexel partners kept their hands in the securitization business by starting Secured Capital in 1990. There, they transferred their trading-desk knowledge of residential mortgage-backed securities into the commercial arena.

Secured Capital's timing could scarcely have been better. During the same period, the Resolution Trust Corp. was looking for financial advisors to structure the first of what were to be many securitized real estate offerings by the federal agency. Roth's new firm won contracts to package $7 billion in securitized form.

"The RTC is what really got us going in the new company," Roth recalls.

These days, Roth spends his time developing new business and supervising his staff. (His office is configured as a large, open trading-floor.) Roth's off hours are spent outdoors, where his fishes, rides a mountain bike and skis "very competitively."

Roth says he sees his business changing. The sale of huge portfolios will soon wind down, "as institutions put their problems loans behind them," he predicts. For the future, Roth and his partners see themselves arranging the sale of "large single assets, whether in loan or property format, as well as playing a role in the continued growth of securitization."

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