A private credit manager has just backed a $1.35bn run of commercial property lending mandates with new people on the ground. HMC Private Credit has appointed state directors covering NSW, the ACT and Queensland, and the hires include former ANZ property bankers. That is a small corporate announcement, but it tells you where the lending action is moving.
What changed and what didn’t
What changed is the scale and staffing. HMC says it has secured $1.35bn in commercial property lending mandates, and it is now adding senior regional leadership to chase larger commercial real estate deals. Recruiting experienced bank property lenders is the telling detail. These are people who built their careers originating and managing large property loans inside a major bank.
What didn’t change is the underlying demand. Developers and property owners still need finance. Construction costs, higher interest rates and tighter credit rules have made that finance harder to get from traditional lenders, not less necessary.
Why private credit is filling the space
Banks have been rationing exposure to commercial property and development for some time. Capital rules, internal concentration limits and a more cautious view of risk mean a lender that once said yes may now say maybe, or offer less than the borrower wanted.
Private credit managers step into that gap. They typically raise money from institutional and wholesale investors, then lend it out against property at higher interest rates than a bank would charge. The borrower pays more, but gets faster decisions and more flexible terms. The investor earns a higher return for taking on a type of loan banks are less keen to hold.
Key numbers
- $1.35bn: commercial property lending mandates reported by HMC
- 3 jurisdictions: NSW, the ACT and Queensland now get dedicated state directors
- Former ANZ property bankers: the new hires’ background
Hiring bank talent is the real signal
A lender can raise money quickly. It takes longer to build the relationships and judgement needed to size, structure and monitor large property loans. Hiring people who already have those skills, and who know the deal flow banks are turning away, is a way to shortcut that.
It also suggests the target is shifting. The stated aim is larger commercial real estate deals, not just small bridging loans. That puts non-bank lenders closer to the territory banks once treated as their own.
The catch: scrutiny is rising alongside the growth
Growth does not come without questions. Private credit has been under closer scrutiny after the collapse linked to Bathla and wider concerns about how some funds value loans, manage conflicts and handle borrowers in trouble. Our earlier look at a development finance lender cutting jobs as exposure bites showed how quickly pressure can show up when property loans sour.
The core risk is simple. If a sector grows quickly into the space banks are leaving, it is also taking on the loans banks decided carried more risk than they wanted. That can work well when property values hold. It looks very different if values slip, construction costs blow out or a refinance falls through.
Who wins and who loses
Borrowers with a sound project but an awkward profile may benefit from another source of capital. More competition among lenders can also improve terms at the margin.
The risk sits with anyone assuming private credit is just a bank loan at a higher price. Terms, security and reporting vary widely between managers. Investors in these funds are also exposed if valuations lag reality.
There is a wider housing link too. Development finance feeds supply, and supply is the missing piece in most affordability debates. Our piece on new home building starts facing a double squeeze covers how funding conditions and costs interact. If private credit can finance projects banks decline, it may support some supply. If scrutiny tightens, that channel could narrow again.
The practical take
Treat one hiring announcement as a data point, not a verdict. It supports the view that private credit is expanding into commercial property lending as banks hold back. It does not tell you whether the loans being written will perform.
If you are a borrower, compare lenders on total cost, covenants and what happens if a deadline is missed, not just headline speed. If you are an investor or adviser looking at private credit, ask how the manager values loans, how concentrated the book is, and what the plan is if a project stalls.
Next step: before relying on any private credit lender, read the loan or fund terms and ask specifically how they handle arrears and valuation changes.
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General info, not financial advice.
