Ares Management signs $450 million facility with non-bank lender
Summary
NYSE-listed alternatives giant Ares Management Corporation has signed up to provide a $450 million senior funding facility to Pallas Capital, in a deal that will help the Sydney-based non-bank lender write bigger cheques.Under the terms, Ares will become a funding partner for the Pallas Funding Trust No. 2, which will lend to borrowers in the commercial real estate sector. Pallas chief investment officer Dan Gallen has allocated an extra $50 million from the firms other vehicles to stand alongside the $450 million facility from Ares.The new facilitys individual cheque sizes are expected to range from $2 million to $25 million double the $10 million upper limit Pallas has had on its previous institutionally funded lending vehicles.The mandate is to hunt for pockets of opportunity in pre-development loans, residual stock loans and investment property loans, that traditional banks and other rival non-bank lenders have overlooked. [We have] successfully managed similar institutional facilities since 2021 ... We are excited to expand this business with Ares as a funding partner. Taking this wider lending mandate to market allows us to target larger loan sizes and a wider range of loan solutions to better meet demand from our borrower and broker partners, Gallen said, adding majority commercial properties were valued at less than $35 million.