Rest has increased its investment in Metrics Credit Partners' Real Estate Debt Fund (REDF) with the aim of further diversifying its exposure to private markets.
REDF provides direct exposure to the Australian commercial real estate loan market by investing in a portfolio of Australian commercial real estate (CRE) loans, spanning industrial, retail, office and residential developments as well as specialised assets such as healthcare and hotels.
Mr Rest said the investment strengthened the company's position in Australian private credit and enabled the fund to take advantage of attractive terms in the domestic non-bank lending market.
“REDF offers Rest members the opportunity to grow their savings through investment in a diversified portfolio of high quality commercial real estate loans across residential and industrial projects,” explained Andrew Lill, Rest's chief investment officer.
“REDF has an attractive risk-adjusted return profile and we expect it to deliver strong outcomes for Rest's members.”
He noted that the combination of rising interest rates and reduced lending by traditional banks has created a more favorable environment for non-bank lenders to participate in commercial real estate lending.
“We believe that the characteristics of the Australian commercial property market give it unique advantages compared to overseas markets, further enhancing REDF's attractive investment proposition,” Mr Lill said.
This is partly due to the line fees and margins that Australian lenders charge on assets prior to construction, which can lead to higher levels of return than similar overseas loans.
Andrew Lockhart, managing partner at Metrics Credit Partners, said the additional investment underscores the value of Metrics' strategic and competitive real estate private credit solutions.
“Rest's increased investment demonstrates confidence in REDF's values and the Fund's strategic approach,” he said.
“We look forward to continuing our momentum together and helping the fund and its members capitalise on the unique opportunities and continued growth potential in the Australian property market.”
The additional investment follows a number of significant investments made by Rest last year, including a $150 million initial investment in an international listed equity mandate with global investment manager NinetyOne announced in February, and signing on as a cornerstone investor in Fidelity International's Fidelity Real Estate Logistics Climate Impact Fund in April.