At the heart of Pallas Capital’s strategy is investing exclusively in quality Australian and New Zealand CRE debt focusing on the major metropolitan markets with excellent demand fundamentals.
Investors
Our Strengths
01
Conservative LVRs
All debt instrument investments are secured against quality Australian and New Zealand real estate at conservative LVRs, typically below 65% and supported by expert independent valuations, less than three months old at the time of loan settlement.
02
Experienced Borrowers
We consider the competence, experience and reputation of the borrower and the underlying sponsor just as carefully as the value of the primary security property. They are vetted through a detailed due diligence process.
03
Strong Security
All of our loans are backed by First and/or Second Mortgages, along with company and unlimited personal guarantees from the Directors of the borrowing entity.
04
Geographic Selectivity
We focus on locations with demonstrably sound demand fundamentals that are close to infrastructure and amenity and/or benefit from changing macro-thematic trends.
05
Defined Exit Strategies
As part of our due diligence process, multiple clearly-defined exit strategies are identified from the outset of every loan. These are closely monitored and managed through to loan completion.
06
In-house Knowledge
Through our unique association with Fortis, we bring an intimate appreciation of borrower needs and project risks. Should a ‘worst-case’ scenario ever eventuate, it also means Fortis could be directly engaged to complete a transaction.
“Our current CRE debt portfolio comprises robust and high quality loans with proven counterparties, strong security and multiple exit strategies.”
Dan Gallen
Executive Director & CIO, Pallas Capital
Investment Products
Single Asset Investments
Our stand-alone real-estate backed loans/investments allow wholesale investors* to select the opportunities they wish to participate in based on their own risk/return profile, asset allocation/portfolio construction and cash considerations.
Investors set their own risk parameters and are able to focus on any preferred sub-asset classes, geographic areas or investment tenor.
* The term “Wholesale Investor” is defined in the Corporations Act, the FMCA (NZ) or equivalent legislation in Hong Kong or Singapore
9-12%
p.a.
Total returns for Senior Debt, registered First Mortgage investments up to 65% LVR, including 1 month BBSW mid rates.
13-18%
p.a.
Total returns for registered Second Mortgage or Preferred Equity investments, including 1 month BBSW mid rates.
18-25%
p.a.
Forecast total returns for Ordinary Equity investments in projects managed by Fortis.
First Mortgage Investment - 9.0% p.a.
Case Study
Brighton, VIC
Product Type
Single Asset First Mortgage
Investor Return
9.0% p.a., paid monthly
LVR
70.0%
Loan Size
$3.7 million
Term
15 months
Description
Funds will be used to settle the acquisition of the Security Property.
First Mortgage Construction - 8.0% p.a.
Case Study
Rose Bay, NSW
Product Type
Single Asset First Mortgage
Investor Return
8.0% p.a., paid quarterly
LVR
65%
Loan Size
$25 million
Term
16 months
Description
To fund construction of 8 luxury apartments.
Pre-Development Loan - 7.0% p.a.
Case Study
Cremorne, VIC
Product Type
Single Asset First Mortgage
Investor Return
7.0% p.a., paid monthly
LVR
65%
Loan Size
$17.5 million
Term
10 months
Description
Pre-Development loan to assist with the acquisition of the Security Property
Preferred Equity - 15.0% p.a.
Case Study
Double Bay, NSW
Product Type
Preferred Loan Notes
Investor Return
15.0% p.a.
LVR Limit
70%
Loan Size
$8 million
Term
18 months
Description
Proceeds of the raise will be used to assist with the settlement of the commercial office building asset and refurbishment works
Ordinary Equity - c. 21.0% IRR
Case Study
Brighton, VIC
Product Type
Ordinary Equity
Investor Return
c. 21.0% IRR
Total Investment
$9 million
Anticipated Term
31 months
Description
To assist in financing the purchase of the property, progress the Planning Permit and complete the construction of the development.
Diversified Funds
Discretionary pooled funds that invest on behalf of our wholesale investors* into a portfolio of qualifying First and/or Second Mortgage loans. Some of our First Mortgage funds also benefit from an ‘Investment Protection’ mechanism that provides a layer of first loss capital. This additional credit enhancement creates a strong alignment via its ongoing Manager co-investment.
* The term “Wholesale Investor” is defined in the Corporations Act, the FMCA (NZ) or equivalent legislation in Hong Kong or Singapore
7.50%
p.a.
Pallas FM Trust (Bond)
4-year fixed rate note, cleared through Austraclear and tradable in the secondary bond market via Bloomberg.
4-year fixed rate note, cleared through Austraclear and tradable in the secondary bond market via Bloomberg.
8.93%
p.a.
(incl. BBSW)
(incl. BBSW)
Pallas Short Term Fund
Short term investments (from 3 months), 4.75% fixed return (plus 1-month BBSW) with diversified open-ended first mortgage fund.
Short term investments (from 3 months), 4.75% fixed return (plus 1-month BBSW) with diversified open-ended first mortgage fund.
10.33%
p.a.
(incl. BBSW)
(incl. BBSW)
PFT Feeder Fund
6.15% Fixed return (plus 1-month BBSW), open-ended fund with opportunity to invest into Pallas Funding Trust No.1. A first mortgage warehouse facility in collaboration with an International Bank.
6.15% Fixed return (plus 1-month BBSW), open-ended fund with opportunity to invest into Pallas Funding Trust No.1. A first mortgage warehouse facility in collaboration with an International Bank.
Pallas FM Trust - 7.5% p.a.
Fixed Term
Fixed Rate Bond
Product Type
Fixed rate notes tradeable via Austraclear
Issue Size
Up to $150 million
Maturity Date
December 2024
Coupon
7.5% p.a. payable quarterly in arrears from (and including) the Issue Date until (but excluding) the Maturity Date
Yield to Maturity
Currently 7.5% p.a., paid quarterly
Maximum LVR
65% against any one First Mortgage loan
Pallas Co-Investment
At any given time, an amount in AUD equivalent to 5.0% of face value of issued Bonds (and comprising cash and/or bank guarantee) will be held as an Investment Protection reserve buffer should the Issuer be required to draw upon it in order to meet its financial obligations to note holders
Pallas Short Term Fund - 8.93% p.a. (incl. BBSW)
Open-ended
3 Month Redemption
Product Type
Diversified First Mortgage fund
Fund Type
Open-ended
Issue Size
Up to $150 million
Redemption Notice Period
3 months
Investor Return
4.75% p.a. (plus 1-month BBSW), paid monthly
Maximum LVR
65% against any one First Mortgage loan
PFT Feeder Fund - 10.33% p.a. (incl. BBSW)
Open-ended
Variable Return
Product Type
Diversified Warehouse Facility
Fund Type
Open-ended
Issue Size
Up to $150 million
Redemption Notice Period
12 months (starting from 1 November 2022)
Investor Return
6.15% p.a. (plus BBSW), paid monthly
LVR
62.7% maximum look-through LVR exposure
Pallas Warehouse Trust No.3 - 10.68% p.a. (incl. BBSW)
Open-ended Fund
12 Month Redemption
Product Type
Diversified First Mortgage Fund
Fund Type
Open-ended
Issue Size
Up to $150 million
Redemption Notice Period
12 months
Investor Return
6.5% p.a. (plus 1-month BBSW), paid monthly
Maximum LVR
65% against any one First Mortgage loan
Investment Protection
Pallas Warehouse Trust No.3 has an Investment Protection mechanism that holds bank guarantees and/or cash equal to 5.0% of the Issue Size. This assists the Fund in meeting redemption obligations in the unlikely event of an underperforming asset and reduces the overall risk profile to the investor.
Pallas High Yield Fund No.2 - 13.68% p.a. (incl. BBSW)
Open Ended
Variable Return
Product Type
Diversified First and Second Mortgage fund
Issue Size
Up to $100 million
Maturity Date
Open Ended
Investor Return
9.5% p.a. (plus 1-month BBSW), paid monthly
Maximum LVR
75% against any one loan
Speak to one of our Distribution Partners
to discuss how our range of current
opportunities may align with your
portfolio requirements.
To speak to one of our Directors about investment opportunities that align with your portfolio requirements, please provide your contact details below.
Call +61 2 9000 5215 now to invest in this opportunity. Alternatively, provide your contact details below to receive the IM.