F Street Group says its investment services arm will expand its reach thanks to $25 million in new financing from a New York lender.
Financial holding company
CIT Group Inc. announced that subsidiary CIT Northbridge Credit arranged a $25 million credit facility for F Street Investments LLC. A part of Milwaukee-based F Street Group, F Street Investments lends to real estate investors and developers.
“This credit facility is going to help further the expansion of our lending services and will allow us to essentially explore markets outside of Wisconsin,” F Street Group spokesperson Mike Doney said.
A credit facility acts as a line of credit that recipients can pull from over a period of time.
Doney said the $25 million credit line, which could get even bigger, “almost nearly doubles our existing fund amount.” F Street Investments has been using an approximately $30 million fund for the past 15 years.
F Street Investments will focus its expansion in the Midwest as a starting point, Doney said. This will include Iowa, Indiana, Ohio and Michigan. Illinois shouldn’t be far behind. The group already has about $3 million in business in that state, but it is not actively marketing there, he said.
Accompanying this geographic expansion, the firm is adding employees. It has so far added three in its Milwaukee office, but could add up to three more soon. It will also look to bring in some “brand ambassadors” in the markets it’s expanding into, Doney said.
“The housing market has strong fundamentals that should remain attractive for investment and development for years to come,” Scott Lurie, chief executive officer and founder of F Street Group, said in a statement. “We appreciated the expertise and agility of the CIT Northbridge team in arranging the financing to support our operations and empower us to continue serving our clients.”
F Street Investments uses the brand
Milwaukee Hard Money. As part of its expansion plans, it recently launched the brand
The Hard Money Co. for investments taking place outside of Wisconsin, Doney said.
It provides loans to investors involved primarily in such residential real-estate endeavors as flips, rehabilitation projects, buy and hold and “wholetailing,” which combines the principles of wholesaling and rehabbing a distressed property. The investments mostly involve single-family and low-unit apartment properties, said Doney.
According to its website, F Street Investments provides “hard money loans” to investors. A hard money loan is a type of loan backed by a hard asset, such as real estate. They are offered by private lenders and individual investors, and not through traditional institutions such as banks.
F Street Investments says hard money loans allow real estate investors to maximize leverage when buying a property. They close quickly relative to other loans – in about 7-10 days – for six-month loan terms at a 15% interest rate.
“F Street is an experienced lender to real estate investors and developers throughout the upper Midwest,” Neal Legan, who leads CIT Northbridge, said in a statement. "We worked closely with the company's leadership to understand their needs and develop a financing package that advances their business strategy."
F Street Group also does business in real estate development, hospitality and emerging markets.
A sampling of F Street Group’s recent activity includes the following:
It recently sold the former Assurant office building to Brookfield-based Milwaukee Tool for $7.9 million, after acquiring it in late 2019 and marketing it to prospective users for redevelopment. It also broke ground this spring on the Greenlink Residences, a 137-unit apartment project in Brown Deer.
Doney said F Street Group’s lending business fueled F Street Group at its beginning “and is still today a main revenue driver.” F Street Group’s development and hospitality endeavors were made possible by funding through the lending business.
