Pender Real Estate Credit Fund: Repurchases, NAV and Loan Book

The October 20, 2026 offer

Every quarter the fund files a Form N-23C-3 with the letter and terms it sends shareholders; the latest was filed on September 15, 2026. It is the interval-fund notice under Rule 23c-3, and the fund's registration statement ticks the box for “Interval Fund (Registered Closed-End Fund or a Business Development Company that makes periodic repurchase offers under Rule 23c-3 under the Investment Company Act).” So this is an interval fund, not a tender-offer fund: there is no separate tender-offer document, only a standing quarterly offer. Its terms:

The cover letter tells holders: “You are not required to sell any of your shares during any Repurchase Offer.” Two practical points sit in the notice. The price is unknown until the pricing date, and the notice warns that NAV “may be higher or lower” than the September 8 figure. And holders through a broker are told to contact their intermediary before submitting a request, whose own cut-off the filings do not give. That matters here because Charles Schwab and Co. is listed in the August 2026 proxy statement with 83% of I1 and 73% of I2 at July 31, 2026, so most holders come through a platform (our reading).

Thirteen completed offers, July 2023 to July 2026

The fund began offering on April 24, 2023, when it took over the portfolio of a private predecessor fund ($208.7 million of net assets in exchange for I1 and I2 shares). From the repurchase tables in its annual and semiannual reports (Form N-CSR and N-CSRS); the percentage is of shares outstanding, as printed.

Every notice since June 2023 offers 5%, the floor in Rule 23c-3, so a result above 5% means holders tendered more than the offer and the fund chose to buy part of the excess (our reading). That happened twice: 6.00% in January 2024 and 6.34% in April 2026, both inside the 7% ceiling the 2% extra allows. The 6.34% offer, which bought 3,056,015 shares, came right after a 2.58% quarter and was followed by 3.11%.

What the filings do not give is the number of shares tendered. The notes use the phrase “pro rata basis” for July 2023, January 2024 and July 2024, but the July 2024 result is below 5%, which cannot be an oversubscribed offer, so the wording is not a reliable guide to proration. Two results are also printed two ways: July 2024 as 4.00% in the annual report table and 3.58% in the semiannual note, and January 2025 as 841,490 shares (2.16%) in the later tables against 952,167 shares (2.45%) in the first annual report that covered it. The later reports give 952,167 shares to April 2025. We show the later tables; the filings do not reconcile the two sets.

Who is paying for the exits

The reports show money in and out by class. New share sales covered the repurchases with room to spare in 2025 and only just covered them in the first half of 2026 (our arithmetic from the capital transactions statements):

Over the same six months the bank lines went from $112.0 million to $131.7 million, up $19.7 million (our arithmetic), while the fund bought $36.3 million of investments and received $12.1 million of principal back. Net assets rose from $469.7 million to $478.0 million. Paying the quarterly offers draws on new sales, loan repayments and the bank lines; the filings show all three, but do not say how much of the July 2026 repurchase of 1,499,237 shares was paid from sales, repayments or the line.

The size of the open offer follows from the share count. The proxy statement lists 19,184,031 I1, 28,021,560 I2 and 39,583 A shares entitled to vote at July 31, 2026, 47,245,174 in all, so 5% is about 2.36 million shares and about $23.7 million at $10.04, against the 3,056,015 shares bought in April (our arithmetic; the rule measures the offer against shares outstanding on the request deadline, so the true figure will differ).

The loan book at June 30, 2026

The June 30, 2026 schedule lists 49 private loans carried at $594.9 million (cost $596.5 million) and one property taken back in foreclosure, with total investments of $600.1 million, 125.5% of net assets. All of it is valued with unobservable inputs (Level 3). By property type, as printed, in percent of net assets:

The percentages exceed 100% because the fund borrows. Multifamily loans are 79.2% of loan fair value and 98.7% of net assets, up from 94.8% six months earlier (our arithmetic for the first figure). Five loans are 28.1% of loan fair value, 34.9% of net assets (our arithmetic): Warrior Fund I ($39.2 million), Atlanta 330 ($36.0 million), Camelot Village Apartments ($35.7 million), Farm to Market Industries ($29.5 million) and Prosper GP ($26.6 million). The fund's annual letter says it seeks “geographic diversity in the Fund’s portfolio over concentrated allocations”; at December 31, 2025 that meant 52 loans in 15 states, and the states are not named in the filings.

Coupons. The weighted-average stated coupon is 8.85% by fair value, with 30 fixed-rate loans and 19 floating-rate loans (35.4% of fair value) priced off one-month SOFR or the one-month Treasury bill (our arithmetic over the schedule). That figure includes the loan carrying a 0.00% coupon after an interest waiver and one at 5.00% under a waiver that runs to October 2026.

Maturities, and what happened to the loans that came due

The fund says its focus is originating short-term bridge loans of 12 to 36 months. Stated maturities in the June 30, 2026 schedule (our arithmetic, by fair value):

November 2026 alone holds $73.1 million of stated maturities (our arithmetic). The more telling test is what happened to the loans that were due in the first half. Comparing the December 31, 2025 schedule with the June 30, 2026 one, 17 loans had a stated maturity on or before June 30, 2026 (our arithmetic). Fifteen show a later maturity in June, one is unchanged and past due, and one is gone from the schedule:

The filings do not say whether these were extension options the borrowers held under the original loan terms or modifications negotiated at maturity, or what fees were charged. They do show the price of the new dates: the Warrior Fund I coupon rose three points, from 8.75% to 11.75% (its spread over one-month SOFR from 4.46% to 7.46%), while The Elms MT, extended to April 2028, fell from 12.74% to 8.74%. The loan with the past-due maturity has its own footnote: “As of June 30, 2026, 1810 Chestnut Street Development, LLC is past due on the maturity payment; the Investment Manager is reviewing for potential default.” Its principal is $13.35 million, its cost $11.37 million and its fair value $11.12 million.

Two more loans carry interest waivers granted by the fund: Tandy (an assisted-living loan, 0.00% coupon, waiver until August 2027, maturity August 1, 2026) and Riverbend (5.00%, waiver until October 2026). The one property taken back, Theos Fedro Holdings, is carried at $5.22 million against a cost of $3.6 million, a $1.62 million write-up in six months.

How the weakest loans are valued. The valuation note splits Level 3 loans into two techniques: a factor analysis with a credit-score adjustment, and a recovery analysis. $40,259,695 of private debt is valued by recovery analysis at June 30, 2026, against $10,568,253 at December 31, 2025 and no amount reported at June 30, 2025. The note does not name the loans. The fair values of Tandy ($10.12 million), Chestnut ($11.12 million) and Riverbend ($19.02 million) add up to exactly $40,259,695 (our arithmetic), and the December figure equals Tandy alone, so we read the bucket as those three loans, 6.8% of loan fair value and 8.4% of net assets. The range of the credit-score adjustment for the rest also widened, from (50) to 50 a year earlier to (100) to 300.

Origination and what is not said about quality. In 2025 the fund originated 29 loans totaling $395.9 million, about $13.7 million each, from 703 financing requests totaling $11.19 billion; 29 of 703 is 4.1% of requests (our arithmetic). The prospectus says the manager “anticipates” a weighted-average loan-to-value at or below 65%, and the annual letter says loan-to-value “strengthened by more than 1.6%” over the year, but no filing we read gives the actual loan-to-value, debt service coverage, borrower or sponsor for any loan. Unfunded commitments to borrowers were $65.4 million at June 30, 2026, the largest being $21.5 million on MavDevMan P1 and $18.4 million on Magnolia TH.

NAV, returns and what the distribution covers

NAV per share has barely moved since the private predecessor fund became this one on April 24, 2023 at $10.00. At the 14 notice dates from June 2023 to September 2026 the NAV quoted never left the band $10.04 to $10.09 across the three classes. From the financial highlights:

The flat NAV follows from how the loans are carried: at June 30, 2026 investments were $600.07 million at fair value against $600.13 million of cost (our arithmetic), a net unrealized change of negative $474,393 in the half. The annual letter explains it this way: “There was very little change in the Fund’s net asset value during the period due to positive underlying performance, age of investments and a lack of exposure to material macro impacts or impairments.” The Bloomberg U.S. Aggregate Bond Index, the fund's benchmark, returned 7.30% in 2025 against 7.05% for I1 and 7.32% for I2.

Distributions against income. In 2025 the fund paid $30.28 million to shareholders against net investment income of $28.87 million, covering 95% (our arithmetic); in the first half of 2026 it paid $17.34 million against $17.84 million, covering 103% (our arithmetic). I1 paid $0.37 a share in the half, about 7.4% a year on a $10.04 NAV (our arithmetic). Of the $30.19 million of 2025 distributions on a tax basis, $169,568 was return of capital.

Class A is tiny. Its net assets were $402,318 at June 30, 2026 against $195.0 million in I1 and $282.6 million in I2; its 5.75% sales charge applies to a very small base so far.

Leverage: two bank lines and a covenant list

The fund borrows through two wholly owned subsidiaries. The lines are secured by each subsidiary's assets and guaranteed, but not secured, by the fund (N-CSRS Note 10):

Borrowings of $131.7 million are 27.5% of net assets and 21.5% of total assets (our arithmetic), and the fund reports asset coverage of 463% against the 300% Investment Company Act minimum, down from 519% at December 31, 2025. Interest and facility costs were $4.29 million in the half, 15.4% of interest income (our arithmetic). The fund was in compliance with all covenants at June 30, 2026. Both facilities list a “change of control” as an event of default; whether the American Beacon transaction below touches that clause is not addressed in the filings we read.

The fund's own figures disagree with each other on size. Its Form N-PORT for June 30, 2026, filed August 24, 2026, reports total assets of $705.7 million, liabilities of $228.7 million and net assets of $477.0 million; the semiannual report filed ten days later reports total assets of $613.5 million, liabilities of $135.5 million and net assets of $478.0 million. The N-PORT lists 50 holdings that sum to $689.2 million, $89.1 million more than the $600.1 million of investments in the report (our arithmetic), and carries Magnolia TH at $28.0 million against $9.3 million in the report. Neither filing explains the gap; unfunded commitments of $65.4 million are smaller than the gap (our reading). Our list of interval funds uses the N-PORT total, which is why it shows borrowings at 18.7% of assets rather than the 21.5% here.

What it costs

The manager's three fees came to $5.48 million in the half, 19.2% of the $28.63 million of total investment income (our arithmetic). The expense limit of 2.75% for I1 and A and 2.50% for I2 excludes interest, the incentive fee and loan servicing, and the prospectus says total expenses are therefore “expected to exceed” those figures. The fund reported net expenses of 4.34% of average net assets for I1 and 4.09% for I2, annualized, for the half. The manager waived nothing under the limit in the half; it voluntarily waived $199,556 of fees and expenses in 2025. Minimum initial investments are $5,000,000 (I1), $100,000,000 (I2) and $2,500 (A), with listed exceptions.

American Beacon: the October 2, 2026 vote

The proxy statement dated August 21, 2026 asked holders of record on July 31, 2026 to vote on October 2, 2026 at 9 a.m. Central in Dallas on three linked proposals. If any fails, none takes effect and Pender stays as manager under the current board.

The proxy gives the two parties' size: American Beacon had about $65.1 billion under management at June 30, 2026 and Pender about $691 million at July 31, 2026. It says American Beacon manages no other investment company with a similar objective. Approval needs a majority of the outstanding voting securities under the 1940 Act definition (the lesser of 67% of shares present if more than 50% are present, or more than 50% of shares outstanding), which puts weight on the platform holders: Charles Schwab and Co. is listed with 15,914,655 I1 shares (83%) and 20,360,334 I2 shares (73%), and RBC Capital Markets with 54% of the A class.

One disclosed conflict deserves a plain reading. American Beacon and Pender have a separate commercial agreement “pursuant to which Pender may be entitled to receive a termination payment in certain non-cause termination scenarios” during the first three years. The fund would not pay it and it is not in the advisory agreement, but the board noted it could create a conflict for American Beacon in judging Pender.

What is not in EDGAR. The last filing through October 5, 2026 is the SEC order discussed next, and none reports the result of the October 2 vote. A September 29, 2026 filing under Rule 486 delays until October 30, 2026 the effectiveness of the July 2, 2026 prospectus update (Post-Effective Amendment No. 6), which had first been delayed on August 28. Nothing we saved shows the transaction has closed.

What the SEC co-investment order says

The last item on the fund's EDGAR page, posted October 5, 2026, is labeled an exemptive order. It is the order itself, not an application. The SEC dated it September 15, 2026 (Investment Company Act Release No. 36330, File No. 812-15981) and says the relief “is granted, effective immediately, subject to the conditions contained in the application, as amended.” The application was filed January 30, 2026 and amended July 28, 2026; a notice followed on August 19, 2026 (Release No. 36307), and no one requested a hearing.

The applicants say co-investing should let the fund join more and larger financings, gain bargaining power on creditor terms and share fixed costs. The documents do not name a single loan, a size, or an allocation between the fund and PC ABL SMA 1, and they do not say how often the fund has so far been barred from a deal. The fund's Note 12 describes an existing loan participation arrangement with one investment company also advised by Pender, under which it had sold $23.9 million of loans as of June 30, 2026 and stopped selling new ones in July 2025; the filings do not say whether that company is PC ABL SMA 1. For a holder the relevant effect is on conflicts: the conditions are the SEC's protection for a fund that now shares deals with its manager's other clients.

What the filings do not say

• How many shares were tendered in any of the 13 offers, so whether any holder was prorated cannot be read; the fund's tables list shares bought, not shares requested.
• The outcome of the October 2, 2026 vote, whether American Beacon has taken over, and whether the lenders' change-of-control clause applies.
• Loan-level credit data: actual loan-to-value (only a target of 65% or below), debt service coverage, sponsor names, property locations (only “15 states”), and the extension terms and fees for the 15 loans whose maturities moved.
• Which loans are valued by recovery analysis, and the reason Chestnut, Tandy and Riverbend are carried as they are, beyond the footnotes.
• What happened after June 30, 2026 to the 23 loans maturing between July and December 2026, including the $73.1 million due in November, and whether the July 2026 repurchase was funded by sales, repayments or the bank lines.
• A reconciliation of the June 30, 2026 Form N-PORT (total assets $705.7 million) with the semiannual report ($613.5 million), and of the three repurchase results printed two ways.
• Who owns the shares held by Charles Schwab and Co., and how many holders are behind the 83% and 73% listed.

What a holder can do with this

• If you hold through a broker or platform (most holders, on the proxy's record of Schwab's share, our reading): your intermediary sets its own cut-off ahead of 4:00 p.m. Eastern on October 20, 2026. The notice says to contact it before submitting a request, and that it may charge its own transaction fee.
• If you hold directly: the form goes to Pender Real Estate Credit Fund, c/o UMB Fund Services, 235 West Galena Street, Milwaukee, WI 53212, to arrive by the deadline; the number in the notice is 1-877-773-7703. You can change or withdraw until then.
• Know the price rule: the repurchase price is NAV on the pricing date, which the fund may set up to 14 days after the deadline. Since the 14 notice dates show NAV between $10.04 and $10.09, the price risk has been small so far (our reading).
• Questions for the transfer agent or your adviser: how many shares were tendered in April and July 2026; whether the fund will use the extra 2% in October; what the fund has said to lenders about a change of manager; and whether the 1.00% class A charge applies to you.
• Tax: the notice calls a repurchase a possible taxable event and the fund is taxed as a REIT; see K-1 vs 1099-DIV for real estate investments for how such funds report.
• If you owned shares on July 31, 2026, the proxy says you were entitled to vote “even if that person subsequently redeems those shares.”

For other real estate credit interval funds see the list of interval funds by size and borrowing, what an interval fund is, and Thirdline Real Estate Income Fund, another small real estate interval fund that is also changing adviser in 2026.

FAQ

All figures are from Pender Real Estate Credit Fund's SEC filings, read on October 14, 2026: the semiannual report on Form N-CSRS for June 30, 2026 (accession 0001213900-26-097073) and annual reports on Form N-CSR for 2023, 2024 and 2025 (accessions 0001213900-24-021017, 0001213900-25-037022 and 0001213900-26-025763), fourteen repurchase notices on Form N-23C-3 from June 2023 to September 15, 2026, the prospectus filed April 30, 2026 (0001213900-26-049981), the proxy statement filed August 21, 2026 (0001213900-26-092592), the co-investment application and amendment (0001213900-26-010306 and 0001213900-26-082365), the notice and orders (9999999997-26-001574, 9999999997-26-001575 and 9999999997-23-001626), the Rule 486 filing of September 29, 2026 (0001213900-26-104759) and the Form N-PORT for June 30, 2026 (0001193125-26-363132). The fund's latest filing on EDGAR is the SEC order posted October 5, 2026. Percentages, sums, counts and ratios marked “our arithmetic” are ours; loan counts and maturity buckets come from our parse of the printed schedules, which ties to the printed totals. The number of shares tendered in each offer and the result of the October 2, 2026 vote are not in these filings. This is analysis of public documents, not investment, legal or tax advice.