Red Oak Capital Group, a Fintech private equity firm specializing in commercial real estate investments, has sold out of its latest offering, Red Oak Capital Fund II, ahead of schedule with $50 million in capital investments.
The $50 million Reg A+ Tier II bond offering was qualified by the SEC in late 2018 and scheduled to close in September. The company said that “stronger than anticipated interest in the bond product and widespread industry support led to the early closing.”
“The support and response from our broker-dealers and industry partners has been nothing short of amazing.” said Chip Cummings, CEO of Red Oak.
Cummings noted that the company had 21 selling agreements with industry partner firms.
Structured as a general solicitation income bond product. The bonds are collateralized by senior liens on the first mortgage notes held by the fund, as well as any other fund assets, and offer a quarterly distribution with a fixed maturity date.
Red Oak Capital is a bridge-bank lender that specializes in the origination, underwriting and acquisition of these smaller commercial real estate debt instruments.
Established by the SEC in 2015 under the JOBS Act, the Regulation A+ Tier II offerings allows companies to sell up to $50 million in securities in a 12-month period. In addition, it requires regular financial filings and audited financial statements.
Red Oak Capital Fund III LLC is currently in review, with an anticipated release in August. The fund will have the same structure as a $50 million Regulation A+, Tier II fixed coupon bond offering, with additional contingent interest paid at maturity, the company said.
Crescent Securities in Dallas served as the managing broker-dealer for the offering and has been retained for Red Oak Capital Fund III as well.
Red Oak Capital Group, which manages several different funds, was founded in 2015 to serve the capital finance and investment markets.