Avon, Conn.-based Structured Finance Advisors (SFA), which has been an investor in the ABS and MBS sectors since 1993, is teaming up with two commercial mortgage veterans to set up a fund that will take advantage of the current lack of market liquidity in the sector, according to Joe Lorusso, president at the firm.


The fund is starting with $10 to $20 million in equity with a bank that would leverage the equity about 3X and is targeted toward $300,000 to $2 million loans that have a 65% current LTV. The average loan will be $1 million.


These loans will be made out to cash-flowing, profitable and businesses that have a pro-forma positive debt coverage ratio.


SFA is teaming up with Fred Dupuy and Rich Sleight, who combined have 40 years of experience in commercial real estate. SFA will primarily be doing the oversight and monitoring work for these loans.


Currently, according to Lorusso, banks have exited the commercial mortgage loan business and SFA, with the help of Dupuy and Sleight, will extend loans to commercial mortgage businesses that are expanding or buying a facility.


Lorusso said that SFA’s role is to make sure that the criteria is met, to review the loans files and to do the monitoring. “There’s opportunity in this end of the market to take advantage of,” he said, adding that he has known Dupuy and Sleight for a long time and is banking on their combined experience.


If you are interested in the venture, please visit sfa-invest.com.



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