This article is from the Australian Property Journal archive
THE 360 Capital Mortgage REIT is seeking to raise additional capital to tap into the fast-growing private credit market, which is forecast to double to $146 billion, as players like Qualitas point out that Australia is still in the early stages of a decades-long growth runway.
The REIT will undertake an equity raising, issuing up to 3,367,000 new ordinary fully paid units at a price of $5.94 per unit.
The first trance is expected to raise approximately $3.68 million, and a conditional placement will raise up to approximately $16.32 million.
The new units will rank equally with existing units and will be entitled to monthly distributions from and including the December 2024 monthly distribution.
The fund’s distribution forecast for FY25 will be maintained at $0.60 p.a., representing an increase of over 118% from the date of the appointment of the responsible entity.
The refund said the capital raising, coupled with the proposed off-market buy-back to be considered at the upcoming EGM, are important steps in continuing to diversify the fund’s loan book, improving market liquidity for the fund’s units, closing the difference between the trading price of the units with the NAV of those units and diversifying the fund’s investor base.
The capital raising comes as the private credit market is projected to double to $146 billion by 2028.
Meanwhile Qualitas managing director and co-founder Andrew Schwartz said the market has potential for further growth over the next decade, due to declining availability of credit from traditional avenues will remain due to regulatory changes.
Despite a slowing economy, Qualitas achieved record deployment of $4.2 billion in FY24, underpinned by the structural shift to private credit in commercial real estate financing.
Looking ahead, Schwartz said conditions remain ripe for private lending.
“With more green shoots in the development market, we have continued to hire new talent into our origination and investment teams. At the current stage of the interest rate cycle, our priority is to maintain an uncompromising approach in our risk assessment and asset management process.
“We expect increasing demand for more flexible financing solutions for commercial real estate.
“We’ve seen how private credit evolved to become a prominent player in the financing sector for developed economies like the United States and the United Kingdom,”
“Australia is still in the early stages of a decades-long growth runway, and we are excited about the opportunities ahead,” he said.
