Boutique specialist fund manager Zagga has expanded its Asia-Pacific reach with the registration of its unitised private credit fund as a foreign investment trust with the Financial Services Agency (FSA) of Japan.
The development means the Zagga CRED Fund will now be available for Japanese investors seeking exposure to the Australian real estate private credit sector and the benefit of its characteristics, such as providing increased diversification, delivering a strong source of income and enhancing the defensive component of a portfolio.
To this end, Zagga has suggested an investment in the fund can offer better protection from market volatility, as well as deliver stable returns.
According to the manager, creating an avenue for Japanese nationals to be able to invest in the Zagga CRED Fund is in keeping with its aim to take its products to a broader audience.
“Registering the Zagga CRED Fund as a foreign investment trust with Japan’s FSA is a logical extension of our desire to attract investors from outside Australia and particularly from South-East Asia,” Zagga chief executive Alan Greenstein noted.
“This move complements our Singapore sub-fund and extends our direct investment offering to a wider Japanese investor base looking to access the same defensive and income-generating potential that has resonated so well with our Australian investors.”
The underlying assets of the fund consist of a portfolio of credit-vetted, mortgage-secured loans within the commercial real estate sector. It aims to generate annual returns of 4 per cent in excess of the official cash rate, with wholesale investors being able to participate via a minimum investment amount of $50,000.
Since its launch in 2016, the Zagga CRED Fund has delivered an average return per annum of around 8 per cent.
In Australia, the fund had achieved total originations of nearly $2 billion as at August 2024 and is available on the BT Panorama, Hub24, Praemium and Netwealth investment platforms.
