Bridge loan specialist snags Triple Point commitment for platform expansion

Faes & Co, a Santa Monica-based investment company, has lined up a funding commitment from London-based manager Triple Point which will allow it to significantly expand its US residential bridge lending platform. With the commitment, F2 Finance has a line of sight to completing its first $100 million of residential bridge loans, according to Christian Faes, chief executive. Although the size of the commitment was not disclosed, Faes believes it will be a step in the firm’s goal of becoming a national bridge lender for the residential and multifamily sector.

The firm is seeking to provide short-term, small-balance loans to investors and property entrepreneurs as part of a plan to build a granular, institutional-quality portfolio.

“Our average loan size is about $400,000 and our average LTV is about 60 percent, which means there is plenty of equity headroom and conservative LTVs. Our loans are also short-dated, about 12 months or less in duration,” Faes said. “The key customer proposition is providing the finance quickly. The borrower can act as if they are purchasing with cash because we can fund them within a couple of days if need be.”

The firm is active in markets which include California, Texas, Florida, Virginia, and Washington and hopes to expand its footprint further afield in the coming months. F2 Finance works with mortgage bankers, lawyers, accountants and other market participants to source deals.

“As a strategy, we are generally targeting states in the US that are non-judicial foreclosure states where, again, you don’t want things to go wrong but if there were to go wrong, we could move swiftly to recover the asset,” Faes added.

Faes, who was a founder of London-based residential and multifamily lender LendInvest, sees a substantial need for housing in the US.

“I see a similar opportunity in the US to when I set up LendInvest because the market is disrupted across the piste,” he added. “US regional banking issues have also created an opportunity because there is less funding in the market overall and that’s the same for short-term, bridging finance borrowers.”

The investment marks Triple Point’s first in the US, with the investment management company seeing a strong growth opportunity, noted James Cranmer, managing partner. Triple Point has 20 years of experience operating in private credit and has long wanted to expand to the US. The firm had an existing relationship with Faes after working in a similar capacity with LendInvest, Cranmer noted.

At LendInvest, Faes and his team offer courses for developers to learn more about building and owning assets and F2 Finance could do the same.

“We have not done that in the US yet but there is opportunity around that. There is a bit of mismatch between the glamorous fix-and-flip houses you see on TV. But the reality is that is typically not like that, and it is hard work for the investors who can make it work,” he added. “Building out useful educational content could be a part of our roadmap.”

The firm is set to expand as there is increased institutional appetite for the asset class.

“Institutions are quite attracted to that profile. It is the ability to scale and commoditize that that is the challenge, to get institutions to fund it,” Faes said.

The firm is in talks with two additional potential partners as part of a broader plan to diversify its funding mix. “Our fund is open-ended, and we will continue to grow. This will increase resiliency as we continue to build a core foundation for our firm,” Faes said.