One of Australia’s big four banks has backed a $380 million debt facility for Pallas Capital, bankrolling the non-bank lender’s growing footprint in small-to-medium enterprise real estate lending.
Coming in as a majority funder to the Pallas Funding Trust No.6 (PFT6), which will lend between $500,000 and $7.5 million to borrowers seeking commercial real estate loans. This includes pre-development loans, residual stock loans and investment property loans.
It joins Judo Bank, which is already a lender into Pallas’ warehouse facilities.
PFT6 differs somewhat from the Pallas Funding Trust No.5, which wrote bigger cheques of $15 million to $35 million to mid-size commercial real estate borrowers. Both stay away from construction loans.
Pallas Capital was established in 2016, seeking to grab the slice of borrowers that are too big for smaller credit funds yet too small for larger non-bank lenders such as Qualitas. It’s part of the Pallas Group, which also includes development manager Fortis.
Pallas Capital signed off on $2.7 billion worth of transactions in the 2025 financial year and is now a major non-bank lender in New Zealand with offices in Auckland and Christchurch.
It has historically been funded by wholesale investors, but has shifted its funding book towards institutional warehouses since 2021. This allows it to lower its funding costs, offer more flexibility around transaction terms, and increase its average loan size.
Pallas’ $500 million Funding Trust No.2 was established by NYSE-listed Ares Management Corporation in 2024 and refinanced by Goldman Sachs earlier this year.
Pallas Funding Trust No.3 was a $185 million construction warehouse facility, backed by Judo Bank, and Pallas Funding Trust No.5 by Morgan Stanley.