RED Capital to Grow After ORIX Goes All-In

A major senior housing lender says it’s poised for growth following a fresh investment from its parent company.

RED Capital Group, LLC is now wholly owned by Dallas-based ORIX USA Corporation, whose ownership of RED officially grew from 88% to 100% on Feb. 22.

ORIX, which offers investment capital and asset management services to clients in the corporate, real estate, municipal and energy sectors, originally invested in RED in 2010. RED has been one of ORIX’s subsidiaries ever since.

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“Increasing ORIX’s investment in RED has been a strategic objective of mine for the last few years, as I have seen firsthand the strength of the RED team and their platform,” ORIX USA Chairman, President and CEO Hideto Nishitani said in a prepared statement. “This is an attractive investment opportunity and signals ORIX’s belief in the strength of the multifamily, seniors housing and affordable housing markets.”

Despite the shift in ownership, RED’s executive management team will remain in Columbus, Ohio, and continue to operate RED as an independent entity.

“With this investment, RED is well-positioned for strategic growth,” Ted Meylor, chairman and CEO of RED, said. This transaction—combined with the creation of the Freddie Mac Small Balance Loan Seller/Servicer program, as well as the addition of multiple high-performing originators to the company—has given RED momentum as it looks to push to the next level in its industry, he added.

RED’s Freddie Mac Small Balance Loan Seller/Servicer program provides custom debt solutions for the refinancing or acquisition of smaller properties with a minimum of five residential units. Small balance multifamily loans involve loan amounts between $1 million and $5 million, and RED’s program offers hybrid or fixed-rate ARM financing with full-term or part-term interest-only option with streamlined documentation processing and underwriting.

RED recently beefed up its team of originators for the multifamily program, bringing the total count to four: Lee Harris, Cynthia Goodenough, David A. Burt and Don Frankman, the head of Small Balance Multifamily Loan (SBL) Originations. The team closed and funded more than $55 million in loan volume in the fourth quarter of 2015.

Written by Mary Kate Nelson

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