Red Oak Capital Holdings, a commercial real estate finance company and Regulation A+ sponsor, today announced that Red Oak Capital Fund V, LLC has been fully subscribed with a $75 million maximum investment capacity.
The vehicle is a Regulation A+ Tier II bond offering designed to provide investors access to commercial real estate.
Fund V was initially qualified by the SEC in mid-2020 with a capacity of $50 million. After completing the sale of its A bonds and A R-bonds in Sept. 2021, Red Oak filed an amendment to increase the maximum threshold to $75 million, which provided for the sale of B bonds and B R-bonds and the extension of the fund’s termination date to Dec. 31, 2022.
“Real estate debt is truly emerging as an attractive investment option, particularly during periods of market uncertainty or volatility,” said Raymond Davis, chief strategy officer of Red Oak. “It combines downside protection with compelling risk-adjusted returns, derived primarily from current income, as compared to government or corporate securities. It’s the best of both worlds, given current circumstances.”
The Red Oak Capital Fund V bonds are collateralized by senior-secured commercial mortgage notes and are backed by existing income-producing commercial real estate properties. The 7.5% A and B bonds and the 8.0% A R- and B R-bonds offer quarterly distributions and mature on Dec. 31, 2026, and Dec. 31, 2027.
Red Oak says it plans to use “nearly all” of the net proceeds from the offering to originate and make commercial mortgage loans through its affiliates and acquire other senior-secured real estate debt.
Red Oak is currently raising capital for Red Oak Capital Intermediate Income Fund, LLC, a Regulation A investment grade-rated bond offering with liquidity options.
Red Oak Capital Holdings is a group of commercial real estate capital entities that lends and invests on commercial real estate, raising capital through retail and institutional channels.