Real Estate Credit
Our Approach
We seek to provide investors with superior risk-adjusted returns in the Private Credit space. Our approach is focused on extensive due diligence with capital preservation at the forefront of every decision. We do not seek the highest return rather the best risk/reward profile.
Loan Types
The Private Credit market sees various loan types offered. We take a bottom-up approach and asses each deal based on their individual merits and varying characteristics rather than a one size fits all approach.
$1BN
0%
20+ YRS
Average Team Experience
Development Land Financing
Secure financing against vacant land that is designated for residential or commercial development. Borrowers can utilise this capital to settle the land and initiate the development application process.
Residual Stock Loans
Access loans secured against completed developments where unsold apartments, land lots or houses remain. This loan is repaid as the remaining stock is sold, ensuring seamless liquidity for the developer.
Commercial Property Financing
Obtain financing for the acquisition or refinancing of office or industrial assets, supporting your growth and investment ventures.
Construction Funding Solutions
Gain funding for both commercial and residential construction projects, with the loan secured against the land and future construction. Secured against the land and future construction, our loans offer progressive disbursement of funds, ensuring effective cost management throughout the entire construction process.
Bridging Loans
Short-term facilities to bridge a gap for developers between a planned expense and a planned income.
Why Invest With Avari
With a fully integrated team of experts, we take pride in navigating the intricate landscape of private lending with exceptional expertise and professionalism.
Versatile Deal Sizes
In-House Property Team
AVARI’s full in-house property team, including architects, analysts, project managers, interior designers, and internal sales/leasing, allows us to assess lending deals from an investor’s perspective to ensure a positive results.
Aligned for Success
We invest in the Fund in the same class of units as investors, aligning interests and ensuring dedicated commitment to our clients’ success.
Extensive Deal Access
AVARI’s knowledge and experience in lending and real estate assets in the Australian market provide broad access to exclusive deals not readily available elsewhere.
Transparent & Informative
Preserving Your Capital
Our experience in property development allows us to identify potential issues, safeguarding investors’ capital and ensure investment success.
Investment Fund Highlights
Loan Assessment
At AVARI, we uphold rigorous standards and meticulous evaluation processes to provide our clients with secure and tailored loan options. Our commitment to mitigating risks and ensuring favourable outcomes underpins every lending decision we make.
Frequently Asked Questions
What Are The Risks Involved
This fund is invested in mortgages backed by individual property assets throughout Australia. As with any property market investment, these assets are subject to general property market risks and may experience fluctuations in value, which could potentially lead to a loss of capital for loan investments.
It’s important to note that the income and capital of the fund are not guaranteed. Any income generated may be reflected in changes to the unit price if the fund’s cash levels are low. While we strive to maintain a secure and profitable investment environment, it’s essential to be aware of the inherent risks associated with property investments and make informed decisions based on your risk tolerance and financial goals.
What is Capital Stack
The capital stack refers to the layers of capital involved in purchasing and operating a commercial real estate investment. It outlines the order in which different investors receive income and profits generated by the property. The typical capital stack consists of four sections arranged in the following order of priority:
- Senior Debt: Senior debt holds the highest priority in the capital stack. These lenders are paid first before any other investors receive a return on their investment. They typically represent the mortgage lender or primary debt holder, with the strongest claim on the underlying asset. This position is considered less risky as the lender can take over the property through foreclosure in case of default.
- Mezzanine Debt: Mezzanine debt holders are paid after all operating expenses and senior debt payments have been made. Similar to a second mortgage on a home, mezzanine debt generally offers a higher rate of return compared to senior debt.
- Preferred Equity: Preferred equity is an intermediate position in the capital stack. It has evolved over time and can function similarly to subordinate debt or hold superior payment rights. It often receives a fixed return without a share of profits, but may have enhanced rights to take over the project in the event of default.
- Common Equity: Common equity holders have the lowest priority in the capital stack. They typically include property operators, sponsors, and investor partners. Common equity holders get paid after all other components in the stack and preferred equity investors have received their agreed-upon returns. Although potentially the most profitable, common equity is also the riskiest part of the capital stack.
How are loans assessed and approved
At AVARI, our loan assessment process is rigorous and meticulous. We conduct thorough due diligence, including evaluating project viability, creditworthiness of borrowers, security analysis, and robust risk control measures.
What types of projects do you finance
How can I get started with AVARI's Real Estate Credit Investments
Getting started with AVARI is simple. Simply reach out to our dedicated team and we will guide your through the process.
