Investing in private debt is becoming an integral path for investors wishing to diversify their portfolios and seek exposure to a different asset class.
Private debt is delivering on its objective of giving investors an alternative to traditional income options, such as bonds, infrastructure and fixed income investments, providing investors with a stable risk-adjusted income stream.
One of the increasingly popular private debt markets is greenfield residential land market, which is a significant sector of the housing story in Australia. A key attraction to this asset class is that it aims to provide capital stability throughout the ever-changing economic cycle.
Banks tighten lending
As banks have tightened their prudential exposures in greenfield funding, non-bank lenders have emerged to fill the void in this space and provide capital support for greenfield developments.
Many of the major greenfield residential projects come with significant upfront construction costs, which banks and other lenders are backing away from, giving the booming private debt market a foothold in this sector.
The market is strong given that Australia has a significant shortage of new housing stock coming onto the market and with state-initiated programs deliver annual housing targets.
While greenfield developments are occurring all over Australia, the state of Victoria has identified greenfield land ideal for residential developments on the fringe of the metropolitan areas recent years. These new growth corridors follow comprehensive planning between councils and developers, opening up affordable new housing options at scale to meet booming demand.
Opening up greenfields
RMBL is dedicated to actively managing the quality of loans and the risks that can affect our investors. We are continuously monitoring and reviewing the performance of loans to ensure we identify any emerging risks and proactively address concerns before they have the potential to impact investors.
With deep insights into the greenfield residential market, we have complete and ongoing visibility over each investment.
The RMBL Mortgage Income Investments Fund is a select mortgage fund that offers a simple, streamlined way for investors to gain exposure to quality properties and developments via first mortgage debt. Funds are lent to borrowers as a source of finance for their projects, or for other working capital needs.
RMBL’s niche area of expertise is in lending for residential subdivisions and multi-dwelling projects. The Fund also has exposure to the englobo land sector, industrial developments and subdivisions with other real estate classes. RMBL prides itself on superior client service, which is one of the reasons why so many clients continue to invest in the Fund.
Around 80 per cent of the Fund’s loans are for developments in Victoria, with the remainder of projects located in other major centres including Adelaide, Sydney, Brisbane and Perth.
Many of RMBL’s property developer borrowers have successfully completed numerous projects with our guidance and support over many years. In fact, some of our investors and borrowers have been with us for more than 40 years, with second generation clients also now part of the Fund.
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This article is for informational purposes only and does not constitute an offer, or recommendation to invest in the Fund. You should read the PDS and TMD available at rmbl.com.au and consider whether an investment in the Fund is right for you before investing.
