Backed by Pallas and Credit Suisse, the Pallas Funding Trust lends between $1 million and $10 million to medium-sized commercial real estate borrowers.
The trust currently has $530 million worth of funding approved by its backers.
It competes with non-bank lenders and does not offer construction loans. The latter is offered by Pallas’ lending business, which settles about $50 million per month in new construction loans.
Pallas chief investment officer Dan Gallen said this under-serviced commercial real estate market segment has substantial lending volumes given that most commercial properties have a value in the range of $1 million to $15 million.
“PFT has been designed to focus its lending business in this borrower segment. In addition, the loan types that PFT funds, such as value-add investment loans, residual stock and pre-development loans are the loan types the banks have limited appetite to fund,” he said.
“With Credit Suisse as a funding partner, PFT is protected from such pressures on liquidity and is well placed to continue lending through cycles that would sideline many of its competitors.”
Pallas raised $194 million in new commitments from high-net-worth and family office investors between June and August.
Since it launched five years ago, its funding structure has reached over $1.2 billion.
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