Oaktree and AVANA Companies Launch $250 Million Joint Venture

AVANA Companies, in collaboration with funds managed by Oaktree Capital Management, L.P., has announced the establishment of a $250 million joint venture named the AVANA-Oaktree Private Credit Partnership. This partnership is designed to support AVANA’s direct private commercial real estate lending strategy within the United States over the next three years.

The joint venture aims to support local economies by providing capital to small and medium-sized enterprises (SMEs) in the commercial real estate sector. The funding will be used for bridge and construction loans across various commercial real estate projects.

Justin Guichard, Managing Director and Co-Portfolio Manager at Oaktree, emphasized the alignment between the two companies. “Oaktree has previous experience partnering with AVANA, and we recognize the AVANA team’s expertise in commercial real estate lending. Their focus on risk control complements our approach to private credit investments.”

Both AVANA and Oaktree bring extensive experience in the commercial real estate industry, with a track record of supporting SMEs across the United States. Recently, AVANA also partnered with a national hospitality group to provide financing for the development and renovation of commercial properties nationwide.

Sanat Patel, Chief Lending Officer and co-founder of AVANA, highlighted the company’s commitment to understanding the needs of the businesses they finance. “We prioritize meeting with every business owner we lend to. It’s a key part of our due diligence and risk mitigation process,” Patel said. He also noted that AVANA’s success in building capital is rooted in their long-standing history in lending and the trust established with partners like Oaktree.

Since its inception in 2002, AVANA has provided loans to over 500 small businesses, with 66% of its customers being black, indigenous, and people of color (BIPOC). The company has funded $1 billion in loans to minority entrepreneurs, contributing to the creation of over 5,500 jobs.

Sundip Patel, CEO and co-founder of AVANA, expressed the company’s determination to navigate the current lending environment. “With 22 years of experience in the commercial real estate industry, we understand the challenges SMEs face. Our goal is to lend $250 million in the first year of this partnership. The capital from Oaktree allows us to significantly expand our impact, offering more financing opportunities to entrepreneurs and promoting financial inclusion.”

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