San Francisco-based Stone & Youngberg, a private investment bank, expanded its operations in New York City recently to signal its commitment to becoming a major player in the municipal market in the Northeast as well as nationwide.
"We've moved to a location that tells people we intend to stay in New York," said Ken Williams, president and chief executive officer.
The new office space is located at the Lever House, 390 Park Ave., an official New York landmark built in 1951 and restored in 2002. Vanity Fair magazine then described the skyscraper as "a 20th century icon."
"Realistically, do we think we're going to run New York City or any of those issues? No. But there are other places where we think we have the opportunity to be the lead manager of financings," Williams said.
Founded in 1931, the firm was the 14th-largest senior manager in the country last year as it ran the books on 165 issues worth $4.1 billion, according to Thomson Reuters. But the vast majority of that volume — about 87% — was for issuers in the Far West, where it ranked seventh.
The firm established a clear regional presence over the past several decades with offices in Los Angeles and San Diego opening in the 1960s, plus another Los Angeles office setting up shop in 2000.
Eight years ago the firm began growing its operations so it could emerge on the national stage. Since then, seven offices have opened up, including those in Phoenix; Richmond, Va.,; Annapolis, Md.: Chicago; Big Bear Lake, Calif.; and Albany, N.Y.
The New York City office originally began in 2004, mostly as a trading floor, but in the past 12 months it expanded its staff from a handful of individuals to about 15 devoted to municipal finance.
"All of this expertise, all of this inherent infrastructure was focused on one part of the country," said Ramiro Albarran, director of East Coast operations. "The goal is to take that core skill set, bring it over to the East Coast, and really start to make a national effort of the firm."
Albarran joined Stone & Youngberg last May precisely to do just that. He had previously spent 10 years with the firm in California from 1991 to 2001. In the interim, he led the public finance division at Banc of America Securities for seven years.
Included among the staff at the new office are Jay Murphy, a 28-year veteran of Goldman, Sachs & Co. who now leads national underwriting, and Jeff Hyman, who previously ran the Northeast municipal group at JPMorgan. Hyman is also a managing director and head of the Albany office.
"Today, we're already a full-service office with underwriting, sales, and a very capable banking team," Albarran said. "We're just going to fill out the team for those areas that we want to expand into."
Albarran said the office plans to hire two more senior bankers this year as the team hopes to lock in deals with local issuers and replicate the success of the California offices by delving into the tax-increment and nonprofit businesses.
Beyond that, the firm hopes to expand its footprint to other untapped regions of the country.
"There are some key markets that we want to be in — the Northeast is one of them, the mid-Atlantic is another," Albarran added. "If you looked at the entire central part of the country from Chicago down to Texas, that's a corridor that we think would make a lot of sense to us."
To date this year, the firm ranks 18th nationally. It senior managed 44 deals totaling $896 million, including 30 deals in California where it ranks eighth, and 11 deals in Arizona where it ranks sixth, according to Thomson Reuters.