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  • Fund holds loans that are secured by registered first ranking mortgages held over Australian properties
  • The fund has doubled over the past fiscal year
  • The non-banking lending sector in Australian could be worth as much as $50 billion

Financier and multi-strategy alternative investment manager Alceon has received a 4-star from SQM Research for its retail private debt fund, the Alceon Debt Income Fund.

The fund holds loans that are primarily secured by registered first ranking mortgages held over Australian property, mostly along the east coast.

These loans finance a mix of real estate development, construction and ownership. The fund only invests in senior and second ranking loans that are secured, with a maximum loan-to-valuation ratio (LVR) of 65%.

As of 30 June Alecon has a loan portfolio of $2 billion, with the Alceon Debt Income Fund doubling in size over FY22.

The find has generated a net return of 8.18% per annum since its net inception to 31 July 2022, aiming to attract yields of 5% to 7%.

“The Alceon Debt Income Fund differentiates from others in the segment by offering an institutional grade fund with a core focus on short duration, secured real estate debt,”  said Grant Atchison, Head of Real Estate Funds Management at Alceon.

SQM Research noted “The Alceon Group has more than a 10-year track record in the Real Estate/Investments industry and has about $4.3 billion in FUM and about 65 staff members. The Firm has a well-resourced and highly experienced investment team.”

“The investment/lending process is thorough and robust. Significant due diligence on investments is undertaken, with independent property and construction industry experts engaged along the investment pipeline. A series of monitoring protocols are in place to mitigate default risk.”

Grant Atchison, Head of Real Estate Funds Management at Alceon

Mr Atchison noted that Alceon and market commentators estimate that non-banking lending in the Australian residential and construction sectors is between $20 billion and $50 billion.

“The fund allows advisers to access this growing institutional asset class that benefits investor portfolios with regular distributions and downside protection during volatile periods.”

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