Red Oak Capital Fund has launched a new private investment fund specialising in debt instruments collateralised by commercial income producing real estate.
Working with seasoned real estate investors and developers, Red Oak intends to expand its reach into the hard-money commercial lending arena for projects that are not typically serviced by traditional institutional lenders.
"There is a huge demand for short-term transitional financing in the commercial real estate market right now,” says Joe Elias (pictured), Senior Director with Red Oak. "Banks and institutional lenders have had their hands tied with red tape and can't be as flexible as they were in previous years, and now that commercial markets are rebounding strong, private investment funds like Red Oak are filling in the gap".
Red Oak plans to target financing for projects that include a variety of multifamily, retail/shopping, office, hotels, and redevelopment and rehabilitation situations. Concentrated in primary markets throughout the United States, projects must also show strong potential for a rapid increase in valuation and stability for funding consideration.
With over 30 years of experience in the commercial real estate and lending industry, the Red Oak principals bring a strong background in "common-sense" lending, and will continue to utilise their existing national network of brokers and agents for quality project deal flow.
"These are real estate projects that make good sense on paper,” says Chip Cummings, another Senior Director with Red Oak. "and by focusing on the underlying debt instruments, and not owning and managing the real estate itself, we are able to mitigate much of the risk and produce stronger returns for our investors."