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It may be time to change the real estate mantra of ‘location, location, location,’ to ‘money, money, money.’ It’s clear to everyone, whether you are struggling to save for a down payment to become a homeowner in Toronto’s insane real estate market, constructing a condominium tower, or facilitating the recent sale of Royal Bank Plaza at Bay and Front Street for $1.2 billion – real estate takes money, and a lot of it.
Obviously, the purchasers of Royal Bank Plaza didn’t go to their sock drawer and pull out $1.2 billion in twenties, they needed financing like everyone else does. Money is the fuel of real estate, and a new player has entered that space with the recent launch of Oakbank Capital Group. Oakbank is a real estate capital advisory firm, arranging financing and raising equity for some of the top condominium developers, industrial, apartment, and office investors across Canada.
Experienced real estate and financial professionals Lindy Masson, Aaron Sun, Jonah Brown and David Bell are the partners behind the new venture. The four all worked at Canada ICI Capital, one of the largest mortgage arrangers in the country. In 2021, Brown and Bell were two of their top producers, collectively arranging more than $1.5 billion in loans.
“In the summer of 2021 when COVID restrictions lifted in Toronto, we were able to take meetings in person,” recalls Bell. “In the span of a month or so, we had a dozen or so clients and lenders encourage us to go out on our own. At that point we started planning what is now Oakbank.”
The partners identified a gap in the marketplace for an independent firm that could provide clients with truly agnostic financing advice. Most large debt advisors also have managed accounts, and therefore have an interest in selling their own products first and brokering the loans externally as a secondary option. By contrast, Oakbank is an advisory business that doesn’t service any loans, therefore being able to provide truly independent advice on the best deals for its clients.
Brown, Sun, Masson and Bell collectively have more than 25 years’ experience in the commercial mortgage industry and have executed more than $6 billion of transactions through their careers and in doing so have built long-standing, quality relationships with the top lending institutions in Canada. This is extremely important in this competitive field as it allows clients direct access to the top executives and decision-makers at those institutions for quicker approval and more seamless transactions overall as Oakbank can leverage those relationships to deliver more favourable results for its clients.
For its debt advisory business, Oakbank accesses capital from foreign and domestic banks, insurance companies, pension funds, credit unions and private equity firms. When it comes to equity, capital comes from the firm’s principals and high net worth families. Just as important as capital is the expertise and analytics Oakbank brings to its day-to-day operations.
“Analytics are of paramount importance as they are what underpin all of our proposals and investments,” says Bell. “Our business is all about numbers and we need to ensure all of our decisions are well informed and supported.”
As it begins its operations, Oakbank’s focus and value is on its debt advisory business, but it anticipates that may change as the firm evolves. “We believe our value proposition will change over time,” says Brown. “We plan to add synergistic platforms and products that will better serve our clients, which will focus more so on the equity side.”
The $1.5 billion Brown and Bell collectively closed in 2021 at their previous firm was a record year for them and they want to beat that number in 2022 – lofty goals for a new company. “Jonah specializes in land and construction financing, whereas I focus on bridge and term loans,” says Bell. “Our experience ranges from sourcing condo construction loans in the hundreds of millions, to term loans on an apartment in the tens of millions, as well as quite a bit of industrial. No matter the asset class or loan type, our team has the experience and execution capabilities to deliver for our clients.”
Oakbank Capital Group is quite clear in its long-term objectives as it launches the new entity during volatile times. “We want to build a best-in-class advisory and investment services firm,” states Brown. “We represent a hundred or so amazing clients and we want to create products and solutions which help them achieve their objectives. Our sole goal at this time is to help our clients grow, which in turn, helps us grow as well.”
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