The deal, completed earlier in February, was funded from the balance sheet of its parent company Pallas Group. The company said no finance was required.
The acquisition will bring Pallas Capital closer to its goal of having $500 million of funds under management by 2020. It has already raised $300 million since 2016.
Gravitas Group, which has raised more than $75 million from wholesale investors for real estate debt and equity products, will no longer trade under the Gravitas name after the merger. Its third-party placement business will cease operation and the distribution arm will focus on Pallas products and building its funds under management.
“We are delighted that the Gravitas investor base will be consolidated with our own existing network delivering increased financing capacity for our borrower clients,” said Patrick Keenan, chairman of Pallas Capital. “The firm’s extensive experience will prove to be a major asset and provide excellent strategic advice as our platform continues to grow.”
The merger forms part Pallas Group’s broader strategy to expand its Melbourne footprint and team.
It follows its recent purchase of a corner site in South Melbourne for $8.55 million with an estimated end value of $38 million after development. The new site will have more than 3300sq m of net lettable area and will also house Pallas Group staff.