$530m funding deal to see Pallas Capital team up with Credit Suisse

New trust to offer cheaper cost of funds for major commercial real estate deals

$530m funding deal to see Pallas Capital team up with Credit Suisse


By Mike Wood

Pallas Capital has set up a new lending vehicle along to help brokers in the commercial real estate debt market to have better access to funds.

The fund, to be known as Pallas Funding Trust, has been created alongside Credit Suisse and will see $530m of funding available, with negotiations ongoing that could see that number rise.

CRE debt funding, such as that offered by Pallas, is a rapidly increasing market in Australia, with borrowers struggling to complete deals financed by major lenders and thus looking to the non-bank sector to plug gaps and get commercial properties onto the market.

Pallas has risen as one of the key funders in this market, passing $1 billion in transactions in July, over $600m of which came in the last financial year alone. Their growth has been such that they have doubled staff numbers since the beginning of 2021 in order to keep up with demand.

“Since launching in 2016, Pallas Capital has carved its reputation as an agile lender with incredible speed to market,” said Steve Lawrence, executive director of lending at Pallas Capital.
“In this time, we have also developed a network of brokers and borrowers who consider us to be their preferred non-bank lender.”

“While PFT will look to specialise in pre-development, residual stock and investment property loans, we intend to offer borrowers the same level of service and reliability, making borrowing a smoother process for them.”

“PFT will offer these borrowers a lower lending rate, and we expect most of these loans will be between $1 million - $10 million in size.”
“PFT is going to be one of the most competitive real-estate loan product ranges in Australia, supported by Pallas Capital’s robust lending strategy”.

“We are confident that it will be well received in the commercial real estate debt market, especially borrowers who currently aren't being serviced by banks.”

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