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BLOOMFIELD HILLS, Mich.--(BUSINESS WIRE)--Michigan-based White Oak Capital Holdings, LLC, dba as Oak Real Estate Partners, a national fund manager focused on the institutional investment sector, announced it has launched Oak Institutional Credit Solutions, LLC, a $500-million private real estate financing investment fund. The newly formed investment vehicle is the company's first fund created specifically to serve the foundation and endowment investor class, though its affiliate company, Red Oak Capital Holdings, has previously delivered seven funds to the retail investor class. The latest fund is formed as a nonpublic offering under Rule 506(c) of Regulation D, which only permits investment from accredited investors.
Oak Real Estate Partners' Gary Bechtel, Managing Principal and Chief Executive Officer, said, "The Fund will be focused on assets diversified across U.S. geographical regions and asset classes, to ensure effective portfolio diversification. The loans will be based on a property's current and future value, with pricing based on the level of risk involved, with higher-risk projects' carrying a higher interest rate and under typically more structured terms. Bridge loans are a compelling financing vehicle compared to other financing options, especially in situations where a property has below market occupancy rates, the borrower's credit profile needs improvement and/or the borrower has an opportunity and needs to close in faster timeframe than possible with other traditional lenders."
Oak Real Estate Partners' strategy is to deliver a leveraged investment solution that is designed to align and support institutional investment objectives. The investment objective is to deliver an alternative return stream that enhances diversification, risk efficiency, and is uncorrelated to broader financial markets. The firm seeks to accomplish this by capitalizing on significant investment opportunities that exist in a highly fragmented, inefficient, and underserved small- to mid-balance lending market. The strategy focuses on balance sheet credit lending that targets short-duration commercial mortgage assets collateralized and secured in the first lien position by high-quality income producing properties.
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Oak Institutional Credit Solutions, LLC is a perpetual term fund seeks to raise $200 million from a select group of foundations, endowments, and multifamily offices and will seek to leverage by another $300 million. In addition, Oak Institutional GP, LLC, the Managing Member will make a commitment of at least $2.5 million, exclusive of the capital commitments. The Fund's objective is to achieve average annual preferred returns of 6%, with follow-on waterfall economics further outlined in the offering.
Oak Real Estate Partners' Raymond Davis, Managing Principal and Chief Strategy Officer, added, "The strategy with this new fund is to provide private debt financing to owners of commercial real estate on a nationwide basis. The company seeks to utilize the strong characteristics of its assets, favorable industry dynamics and the significant expertise and experience of the company's senior management team to provide investment opportunities to the institutional investor sector."
The Oak Institutional Credit Solutions, LLC fund specializes in providing commercial real estate backed senior mortgage bridge loans, which are customized loans that provide short-term financing for the purchase, rehabilitation, or re-positioning/re-tenanting of commercial real estate. In addition to funding renovations and upgrades, the bridge loans may be offered to borrowers who cannot initially qualify for permanent financing from conventional lenders.
The Fund is expected to include roughly 50 to 100 assets at any time when fully deployed, providing significant diversification for investors across geography, industry, tenant mix, structure type and property type. The Fund targets loans on multifamily, retail, office, industrial, mixed-use, hospitality and other CRE properties located in primary, secondary and select tertiary markets within the United States.
Oak Real Estate Partners is one of only a few firms in the small- to mid-balance sheet lending market that employs an institutional approach to credit underwriting utilizing CLO/CMBS quality standards, a standard employed by large insurance and financial institutions. Its national lending platform, market presence and network of deep broker relationships provides Oak Real Estate Partners access to a significant volume of high-quality transactional deal flow.
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Oak Real Estate Partners' Brook Scardina, Managing Partner, Capital Markets & Investments, said, "Given the expectation of elevated volatility across financial markets, we believe that delivering a return that is diversifying with low correlation will be instrumental in driving and supporting the institutional return objectives over the long-term. It's widely anticipated that alternatives will be the best performing asset class over the next 10-years given capital market assumptions and expectations."
"Based on the velocity of capital and high-quality of the deal flow within the firm, there is significant value to be harvested and realized in the execution of the strategy and experience of the team. We expect our investment strategy and solution to be one of the most consistently performing assets within the construct of a total portfolio. As a firm, we look forward to cultivating strategic relationships with investors seeking yield, income, diversification and down-side protection in the creation of mutual value," Scardina added.
The Fund has secured more than $60 million of pre-launch indications of interest comments prior to its formal launch. Those initial capital commitments speak to management's experience and past performance. Oak Real Estate Partners' principals have completed more than $25 billion of total real estate financings over the past 35 years and successfully navigated eight market cycles.
About Oak Real Estate Partners
Oak Real Estate Partners is a vertically integrated small- to mid-balance sheet commercial real estate lender that provides short-term, senior secured stabilization loans on high-quality income-producing commercial real estate properties located in major geographic markets. The Michigan-based fund manager is held by White Oak Capital Holdings, LLC, and is the institutional investment arm affiliated with Red Oak Capital Holdings, a group of commercial real estate capital entities that lends and invests on commercial real estate, raising capital through retail and institutional channels.
Oak Real Estate Partners complements the existing Red Oak lending and investment-based business, handling the high-quality institutional-quality transactions. The senior leadership team is comprised of backgrounds from the insurance, banking, commercial real estate, family office, and institutional asset management industry. Collectively, the team has established a proven track record of executing and delivering value-added investment solutions within the lower lending market.
Contacts
Connect CREative
Dennis Kaiser
dkaiser@connectcre.com
(213) 459-1764
Oak Real Estate Partners' Gary Bechtel, Managing Principal and Chief Executive Officer, said, "The Fund will be focused on assets diversified across U.S. geographical regions and asset classes, to ensure effective portfolio diversification. The loans will be based on a property's current and future value, with pricing based on the level of risk involved, with higher-risk projects' carrying a higher interest rate and under typically more structured terms. Bridge loans are a compelling financing vehicle compared to other financing options, especially in situations where a property has below market occupancy rates, the borrower's credit profile needs improvement and/or the borrower has an opportunity and needs to close in faster timeframe than possible with other traditional lenders."
Oak Real Estate Partners' strategy is to deliver a leveraged investment solution that is designed to align and support institutional investment objectives. The investment objective is to deliver an alternative return stream that enhances diversification, risk efficiency, and is uncorrelated to broader financial markets. The firm seeks to accomplish this by capitalizing on significant investment opportunities that exist in a highly fragmented, inefficient, and underserved small- to mid-balance lending market. The strategy focuses on balance sheet credit lending that targets short-duration commercial mortgage assets collateralized and secured in the first lien position by high-quality income producing properties.
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Oak Institutional Credit Solutions, LLC is a perpetual term fund seeks to raise $200 million from a select group of foundations, endowments, and multifamily offices and will seek to leverage by another $300 million. In addition, Oak Institutional GP, LLC, the Managing Member will make a commitment of at least $2.5 million, exclusive of the capital commitments. The Fund's objective is to achieve average annual preferred returns of 6%, with follow-on waterfall economics further outlined in the offering.
Oak Real Estate Partners' Raymond Davis, Managing Principal and Chief Strategy Officer, added, "The strategy with this new fund is to provide private debt financing to owners of commercial real estate on a nationwide basis. The company seeks to utilize the strong characteristics of its assets, favorable industry dynamics and the significant expertise and experience of the company's senior management team to provide investment opportunities to the institutional investor sector."
The Oak Institutional Credit Solutions, LLC fund specializes in providing commercial real estate backed senior mortgage bridge loans, which are customized loans that provide short-term financing for the purchase, rehabilitation, or re-positioning/re-tenanting of commercial real estate. In addition to funding renovations and upgrades, the bridge loans may be offered to borrowers who cannot initially qualify for permanent financing from conventional lenders.
The Fund is expected to include roughly 50 to 100 assets at any time when fully deployed, providing significant diversification for investors across geography, industry, tenant mix, structure type and property type. The Fund targets loans on multifamily, retail, office, industrial, mixed-use, hospitality and other CRE properties located in primary, secondary and select tertiary markets within the United States.
Oak Real Estate Partners is one of only a few firms in the small- to mid-balance sheet lending market that employs an institutional approach to credit underwriting utilizing CLO/CMBS quality standards, a standard employed by large insurance and financial institutions. Its national lending platform, market presence and network of deep broker relationships provides Oak Real Estate Partners access to a significant volume of high-quality transactional deal flow.
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Oak Real Estate Partners' Brook Scardina, Managing Partner, Capital Markets & Investments, said, "Given the expectation of elevated volatility across financial markets, we believe that delivering a return that is diversifying with low correlation will be instrumental in driving and supporting the institutional return objectives over the long-term. It's widely anticipated that alternatives will be the best performing asset class over the next 10-years given capital market assumptions and expectations."
"Based on the velocity of capital and high-quality of the deal flow within the firm, there is significant value to be harvested and realized in the execution of the strategy and experience of the team. We expect our investment strategy and solution to be one of the most consistently performing assets within the construct of a total portfolio. As a firm, we look forward to cultivating strategic relationships with investors seeking yield, income, diversification and down-side protection in the creation of mutual value," Scardina added.
The Fund has secured more than $60 million of pre-launch indications of interest comments prior to its formal launch. Those initial capital commitments speak to management's experience and past performance. Oak Real Estate Partners' principals have completed more than $25 billion of total real estate financings over the past 35 years and successfully navigated eight market cycles.
About Oak Real Estate Partners
Oak Real Estate Partners is a vertically integrated small- to mid-balance sheet commercial real estate lender that provides short-term, senior secured stabilization loans on high-quality income-producing commercial real estate properties located in major geographic markets. The Michigan-based fund manager is held by White Oak Capital Holdings, LLC, and is the institutional investment arm affiliated with Red Oak Capital Holdings, a group of commercial real estate capital entities that lends and invests on commercial real estate, raising capital through retail and institutional channels.
Oak Real Estate Partners complements the existing Red Oak lending and investment-based business, handling the high-quality institutional-quality transactions. The senior leadership team is comprised of backgrounds from the insurance, banking, commercial real estate, family office, and institutional asset management industry. Collectively, the team has established a proven track record of executing and delivering value-added investment solutions within the lower lending market.
Contacts
Connect CREative
Dennis Kaiser
dkaiser@connectcre.com
(213) 459-1764
Filed Under: Business
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