Velocity Financial Inc. agreed to acquire Toorak Capital LLC for approximately $3.2 billion in an all-cash transaction, expanding its presence in business-purpose residential lending.
The deal includes the purchase of Toorak’s operating platform, comprising Merchants Mortgage & Trust Corporation in the U.S. and Toorak’s credit operations in the U.S. and U.K. Toorak also entered into agreements to sell its existing $3 billion portfolio of business-purpose loans to a third-party investment firm, with Velocity set to manage the portfolio post-acquisition.
Velocity will further enter into agreements to sell Toorak’s future loan production to the same investment firm and additional counterparties. The transaction is expected to close in the fourth quarter of 2026, subject to customary conditions.
Toorak Capital, founded in 2016 and headquartered in Tampa, Florida, specializes in providing capital to real estate investors for residential property acquisitions, renovations, and rentals. Since inception, the platform has originated over $20 billion across nearly 43,000 loans, including short-term transition loans, construction loans, and long-term rental property financing.
Toorak will retain its existing brands and leadership under Chief Executive Officer John Beacham, who will assume the role of Executive Vice President of Velocity Commercial Capital, LLC. Barclays Capital Inc. advised Velocity on the deal, while Piper Sandler & Co. advised Toorak and KKR-affiliated funds that control the majority of the platform.
