25 Aug Specializing in Specialty Lending Is Our Forte

By Michael McAdams, President, Pasadena Private Lending

The first half of 2026 has been busy for PPL after we doubled our capital in late 2025. With that “dry powder,” besides increasing credit facilities to existing clients, we made loans to 16 new borrowers totaling over $125MM since the turn of the New Year, taking our overall portfolio to over $300MM and 60 clients.

Since we began our business, our total number of borrowers served has risen to over 100, having lent over $500MM to small-to-medium sized businesses across 16 states. But as important as the larger portfolio numbers might be, the truly amazing part of our story is the entrepreneurship, creativity and relentless hard work that our borrowers have brought to the table that have enabled us to help further their dreams.

Let us walk you through just some of the exciting businesses we have recently had the pleasure to get to know and fund with senior debt capital.

Contract Food Processor. This long-established, larger but privately-owned firm with multiple facilities, hundreds of employees, and a strong cash flow is a contract producer of branded food products. They needed financing to acquire a company bringing a new proven product line to their portfolio. The well-secured transaction was completed while the parent was undergoing some internal structural changes, making this a more challenging deal for other lenders.

Road Construction Materials. Senior debt capital was provided to take out existing higher-cost debt and finance the acquisition of a road construction materials company based on receivables, inventory, equipment, existing facilities, and a strong personal guaranty from the new owner/guarantor. The prior owners are staying around to assist in customer service and the transition, incentivized to do so.

Specialty Genetics Testing. It’s an exciting business providing non-invasive, pre-natal medical screening, hereditary cancer screening, and other specialty medical testing using highly complex molecular diagnostics for over 1,000 physicians nationwide. We refinanced prior high-cost debt and increased their line to grow out of a prior non-medical vendor software issue.

Diversified Investment Company. PPL has periodically financed portfolios of venture and private equity investments as part of other business activities of a borrower. But this one is more like a sole-investor private equity firm seeking to purchase a unique, proven software business. Larger than our normal transactions and having stronger financials and better reporting, PPL was able to commit faster than other lenders.

Diversified Mini-Conglomerate. This unique firm is currently both buying and selling distinct business units from its portfolio of companies engaged in commercial HVAC production, industrial gasses, precision manufacturing for defense, aerospace, industrial markets, and industrial refrigeration services.

Legal Claim Finance. A newcomer to the PPL lending strategy, this borrower purchases major legal claims and pools of smaller claims that are pending in the court system. The principals are experienced attorneys with substantial net worth, and the claims and any payments from the multiple sources of cash flow from the diversified portfolio are pledged to PPL as collateral.

True Full-Service Med-Spa Expansion. Beyond just “Botox and massage,” this high-end chain provides an extensive menu of non-medical and medical wellness services. The largest U.S. developer of this brand has leveraged their existing financial services businesses’ success to build out this concept.

Multi-Unit Specialty Restaurants. A food-hall pioneer and developer required additional financing secured by land and buildings and additional side collateral. The goal was to secure a long-term contract to develop and run a major institutional facility.

Commercial Aerial Photography Business. A significantly wealthy business person purchased a specialty aircraft fitted with cameras and sensors for real estate, environmental and other scanning services. In addition to aircraft as collateral, we have other side collateral and, as usual, the owner’s meaningful guaranty.

Waste-to-Energy Facility. PPL’s second loan in this unique industry, a wealthy investor purchased a controlling interest in a recycled tire-to-fuel technology company secured by their existing successful financial business.

Despite the variety of businesses, differences in use of proceeds, ages of the firms, and structural complexities, all of PPL’s loans are evaluated according to our three common Pillars of Credit: financial due diligence, collateral sufficiency, and the significance of the owner’s guaranty.

That is, we conduct normal background and financial checks and analysis. We evaluate collateral to ensure we have a second means of repayment if cash flows disappoint. And we need an owner to personally guaranty our debt and to confirm they have sufficient resources to help the firm weather unexpected storms, which thereby allows PPL to be more aggressive in its loan terms than it might otherwise be.

In addition, most of PPL’s loans are funded term loans with 3-to-5 year maturities where we typically require only 50-60% repayment by the final due date, leaving a reasonably refinanceable “balloon” payment. Also, all of our loans’ interest rates adjust based on the traditional U.S. prime rate as quoted daily in the Wall Street Journal.

We hope there are insights to be learned from this review and that it inspires other companies and owners to contact us to see how we might be able to provide creative financing to other similarly successful entrepreneurs. Should you have any questions, please do not hesitate to contact us.