Australian specialist private credit investment manager Zagga has launched a new real estate private credit fund designed to meet growing demand from Southeast Asian investors, according to an announcement.
The newly launched Zagga Real Estate Credit Fund (ZRECF), structured as a Singapore Variable Capital Company (VCC), is designed to meet the increasing demand from Southeast Asian investors for exposure to Australia’s commercial real estate market.
Zagga said the fund will focus on prime assets along Australia’s East Coast and will offer currency flexibility in AU$, SG$, HK$, and US$.
Since originating its first loan in 2017, Zagga said it has invested over $2.5 billion across more than 300 transactions in the Australian commercial real estate sector, spanning residential, commercial, and industrial property assets.
Its global investor base includes HNWIs, family offices, and institutional funders from Japan, Singapore, China, Mauritius, Switzerland, the USA, South Africa, and Australia.
Along with launching the new real estate credit fund, Zagga also announced the appointment of Roushana Sjahsam as Senior Board Adviser for ASEAN.
Sjahsam, a veteran in Asia’s debt and capital markets, most recently served as Managing Director at Cantor Fitzgerald Capital Markets in Hong Kong. She also held senior roles at Citibank and ADM Capital.
In her new role, Sjahsam will lead efforts to deepen Zagga’s relationships with institutional investors, family offices, and wealth managers across the region.
Sjahsam noted that current market conditions present a strong opportunity for ASEAN investors seeking exposure to the Australian property sector.
“Private credit only makes this more compelling due to its defensive characteristics and stable, reliable income amongst heightened global volatility,” she added.
ASEAN capital currently accounts for about 15% of Zagga’s funds under management, with a goal to double this over the next two years. The company has strengthened its regional headcount by 50% in the last 12 months.
The private credit sector has grown to $1.5 trillion globally, making it the third largest alternative asset class, after hedge funds and private equity.
Non-bank loans are still 20% of the lending industry in Asia compared to 65% in the US. Against historical default rates, investors are not getting sufficient compensation in developed markets like the US, so they are looking at Asia with the hope of generating a premium, according to DealStreetAsia’s Beyond the Buyout: What’s working for private credit in Asia?.
