In this TUD+ Briefing, Pallas Capital executive director Dan Gallen discusses the group’s doubling of its origination capacity each year as it looks to deploy more than $1-billion in financing across 2021.
“Our rapid evolution has been from high-net-worth investors, to family office, to loan-by-loan, into now funds that we have discretion and control over subject to a set of rules,” Gallen said.
“For mortgage managers currently in the Australian real estate debt market that are moving from loan-to-loan; it is good for the time being, but not truly competitive and stable long-term fix post-pandemic.
“We are moving into that ‘long-term fix’ phase now with pools of stable capital that will allow us to continue lending through cycles as we won’t be waiting on investors to redeploy their own capital.”
Throughout the pandemic non-bank lenders have continued to occupy space left as the big banks reduce their exposure to riskier assets such as shopping malls, hotels, lower grade offices and residential developments.
Gallen said the company’s “entrepreneurial flair” and close ties to the property industry was now a key differentiating factor Pallas was providing compared to its competitors vying for new slices of the market.
“Investors are looking for two things, security off their principal investment and yield, it’s that simple,” Gallen said.
“During the first lockdown, nervousness hit the market, and all of sudden liquidity from high-net-worth investors drains out of the market.
“While the nervousness remains an annoyance it is not stifling investment anymore and they are very much back in the market on the hunt for safe, successful, high yielding investments.”