Secured private credit: capital protection in Australian property

Capital protection is the first question a serious investor should ask — not the last. Secured private credit answers it directly: lending against real property, with the asset itself standing behind your capital.

What secured private credit is

Secured private credit is asset-backed lending. By taking security over property, the lender builds in a margin of safety: if a borrower defaults, the asset can be realised to repay capital. It is a structured way to earn income while keeping downside risk contained.

How it protects capital

• Real security — a registered mortgage over the underlying property.
• Priority of repayment — secured lenders rank ahead of equity in the capital stack.
• Conservative leverage — sensible loan-to-value settings leave a buffer between the loan and the asset's value.

Understanding the risks

No investment is risk-free. Valuation movement, borrower performance and market liquidity all matter, which is why disciplined due diligence — on the asset, the sponsor and the structure — is non-negotiable.

Structuring the capital stack

A boutique manager structures secured positions across the stack so investors can choose their level of risk and return:

• Senior debt — first-mortgage security and the most conservative position.
• Mezzanine finance — second-ranking security that reduces the sponsor's equity requirement.
• Preferred equity — priority returns ahead of ordinary equity, with governance protections.

Leverage and pricing at each level are set against the individual asset, sponsor and project rather than to a fixed schedule.

Why it matters now

In an uncertain property market, secured private credit offers a rare combination: real income with a genuine capital buffer. For wholesale investors who put security first, it is a foundation worth understanding.

This is general information about wholesale investment structures only. It is not financial, legal or tax advice, is not an offer, and does not take account of your objectives or circumstances. Any investment is made solely on the terms of the relevant offer document.

Related reading

• senior debt investment positions
• mezzanine finance positions
• preferred equity positions