Every lender’s behavior is shaped by where its capital comes from and when that capital needs to come back. A bank funds loans with deposits and is governed by capital rules. A closed-end private credit fund raises commitments from investors, invests them during an investment period and must return them by the end of a fixed life. A lender with permanent capital has neither constraint.
Caldrion is a single family office. It invests only its own capital, has no outside investors and does not manage anyone else’s money. When we lend, we lend Caldrion’s own permanent capital and hold each loan on our balance sheet. This entry explains what that means in practice. The broader argument is set out in our article Whose capital, and when it needs to come back.
What permanent capital means
“Permanent capital” describes capital that has no contractual date by which it must be returned to someone else. It can come from an insurance balance sheet, a publicly listed vehicle, an endowment or, in our case, a family’s own capital.
The contrast with a closed-end fund is useful:
| Feature | Closed-end private credit fund | Permanent capital lender |
|---|---|---|
| Source of capital | Commitments from outside investors | The lender’s own capital |
| Investment period | Typically a few years, after which new loans usually stop | None |
| Fund life | Fixed, often with limited extensions | None |
| Pressure to deploy | Uninvested commitments create pressure to lend | Capital can wait for the right loan |
| Pressure to exit | Loans must be repaid or sold before the fund winds down | Loans can be held to their natural conclusion |
| Approvals | Investment committee, sometimes investor or advisory board consents | Internal investment committee only |
None of this makes funds bad lenders. Many are excellent. But the fund structure creates timing pressures that a borrower should understand, especially late in a fund’s life.
What it changes for a borrower
Certainty of close
A term sheet is only as good as the capital behind it. A lender that must arrange financing, find co-lenders or obtain outside approvals after signing a term sheet introduces execution risk. A lender with capital on hand removes it.
Decisions are made by a small internal investment committee that meets weekly. We need no outside approvals and no fundraising to close. That does not mean every loan closes on a fixed timeline—diligence takes as long as the collateral requires—but it does mean the term sheet is backed by capital that already exists.
No sell-down
Many lenders originate loans intending to sell part of them to other investors after closing. That is a legitimate model, but it changes who the borrower deals with later and can make amendments slower, because more holders must agree.
We do not originate to sell down or distribute. We hold each loan on our balance sheet, so we never need to sell down a position to close, and the borrower’s counterparty on day one is still its counterparty at maturity.
One team from first call to repayment
We originate, structure and service every loan directly. The team that underwrites the loan is the team that services it. A borrower who asks for a consent, a draw or an amendment is talking to people who already know the collateral and the plan.
Extensions judged on their merits
This is where permanent capital matters most. Plans take longer than expected: lease-up runs a quarter late, a sale process slips, a customer delays a contract. A lender facing the end of its fund life may have to insist on repayment, sell the loan or push for a refinancing at the worst moment. A lender without that clock can evaluate an extension request against the collateral and the plan.
Our terms are 12–36 months, with extension options. Extension options are written into the loan at the outset, usually with conditions. Where a sound plan needs more time beyond them, we assess the request on its merits. That is not a promise to extend every loan; it is a statement that the calendar is not the deciding factor.
What it does not change
Permanent capital is not patient capital in the sense of tolerating weak credit. Our criteria are the same whether a loan is the first or the fiftieth of the year:
- We lend in the $5M–$50M range, held on our balance sheet.
- We focus on first-lien, senior secured positions, with mezzanine only selectively and with strong control rights.
- We lend up to 75% loan-to-cost and up to 65% loan-to-value.
- We lend in the United States, in major metros and business-friendly states.
Nor does it mean lower pricing. Our pricing is SOFR + 600–900 bps, or a fixed-rate equivalent, with an origination fee of 1–2%. Borrowers pay for speed, flexibility and certainty; permanent capital is part of what makes those possible.
Why a family office lends at all
A family office has many ways to invest. We lend because private credit has a specific job in Caldrion’s portfolio: it is the income engine. Senior secured loans produce contractual current income, with low correlation to public markets, while sitting ahead of equity if something goes wrong.
Caldrion also owns and operates real assets and businesses. That experience shapes how we lend: we value collateral the way an owner would—by what it is worth, what it earns and what it would take to realize it. It is also why we lend where we do, in the focus areas described in Loan types and focus areas.
Questions to ask any lender about its capital
Whether or not you work with us, these questions are worth asking before you sign a term sheet:
- Is the capital committed and available today, or does it depend on a fundraise, a warehouse line or co-lenders?
- Will the lender hold the whole loan, or does it intend to sell part of it?
- Where is the lender in its fund life, and when must its capital be returned?
- Who must approve the loan, and does anyone outside the lender’s own committee have a say?
- If the business plan takes longer than expected, what drives the lender’s decision on an extension?
Our answers are on our process page. If you have a request that fits our criteria, you can submit it here.
This entry is general information as of November 2026, not investment, legal or tax advice, and not an offer of securities.