Commercial real estate (CRE) investment manager Pallas Capital has now reached the $2 billion mark in cumulative transactions, underwriting $1.1 billion in transactions in less than 12 months. The milestone reinforces the strength and resilience of real estate credit as an asset class among investors and borrowers alike.
Pallas Capital raised these funds from its HNW, Family Office and institutional investor base, introducing an array of products in the last year that respond to their diverse investment needs, propelled by the superior defensive qualities of the asset class.
Of the 280 transactions managed to date, 121 have been fully repaid, with the rest continuing to perform satisfactorily. None of the investments managed by Pallas Capital since its inception in 2016 have suffered any credit impairment.
The funds were allocated across a range of first and second mortgage loans. Whilst largely focused on Sydney, Melbourne, Brisbane, and Adelaide, Pallas Capital’s appetite has grown to include the well performing regional centres.
Pallas Capital’s lending approach has significantly expanded in recent years to include everything from $2 million acquisition loans to $100 million loans for mixed-use projects. In 2022 alone, Pallas Capital has funded a $2 million loan to assist with the acquisition of an investment property in Putney, a $7.5 million residual stock loan to refinance a completed residential project in Adelaide, a $15 million construction loan to deliver a medium density residential project in Sydney’s northwest and a $90 million loan to fund a large mixed-use project in Melbourne’s inner east.
“It took Pallas Capital five years to transact its first billion dollars of investments, and less than a year to transact its second billion. I believe this reflects both the expertise and dedication of our staff, together with our growing reputation for professionalism and reliability,” says Dan Gallen, Chief Investment Officer, Pallas Capital.
He adds, “We now have 100 staff within Pallas Group, covering our lending and investment operations, and our property development side. These teams give us an unmatched window on the marketplace for the loans and property assets which we develop, or against which we lend. I believe that our investors, borrowers, apartment buyers and commercial tenants all benefit from our unique market insights and growing transaction volumes.”
Pallas Capital is one of the fastest growing structured property investment arrangers in Australia, offering brokers and developers lending solutions that are tailored to their needs. It offers borrowers five core loan types, being acquisition, pre-development, construction, residual stock and vacant land loans, along with the flexibility to negotiate LVRs and the required level of pre-sales for construction loans.
Pallas Capital manages funds for investing in commercial real estate loans secured against non-specialised property assets with values between $1 – $50 million in major metropolitan areas. Wholesale investors are offered investment opportunities providing fixed or variable rate returns ranging from 6% p.a. in the Pallas Short Term Fund to 7% to 8% p.a. (first mortgages), 11% for the High Yield Fund (First and Second Mortgages) and up to 13% p.a. for preference equity investments. Pallas Capital’s loans are supported by robust due diligence on each borrower and the security property, a realistic and multi-faceted exit strategy, and active management of all loans by the Pallas Capital team throughout the term.
Pallas Capital and developer Fortis comprise Pallas Group, a business that provides specialist investment, lending and development solutions in the boutique property market in Australia.
For more information and details about Pallas Capital’s product, visit pallascapital.com.au
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