We underwrite the sponsor before the site.
Every deal goes through four stages, in order. The first two happen before we order a valuation. We document the whole thing and show it to investors who want to see it.
Four stages, in this order.
Stage one · 1–2 days
The sponsor screen.
Before we touch the asset, we look at the people. What have they finished? Did the last project pay back the people who funded it? What do their QS and their lawyer say when we ring them? It's a real conversation, not a credit memo template.
Result: proceed, decline, or “come back when X is true.”
Stage two · 3–5 days
The site and the structure.
Now the asset. Title, planning status, environmental, building consent, builder and consultants. The capital stack: where we sit, who sits behind us, where the equity comes from. We model three downside cases: a 15% drop in values, a six-month build slip, the anchor tenant walking.
Result: indicative term sheet, or a structured “yes if …”.
Stage three · 4–6 days
Independent diligence.
Now we spend money. Independent registered valuation, independent QS cost-to-complete report, legal due diligence on title, contracts and security. We don't use the borrower's QS and we don't accept self-valuations. We've been burnt by both, elsewhere, earlier in our careers.
Result: credit memo to committee.
Stage four · 1 day
Credit committee.
Three voting members. Unanimous approval, or we don't write the loan. One of the three has never met the sponsor — the deliberate stranger in the room. We keep proper minutes and the decision is final.
Result: credit-approved letter, or decline with written reasoning.
What we'll write, and what we won't.
Senior secured construction
- Facility size
- NZD $5m – $40m
- Term
- 12 – 24 months
- Max LVR
- 65% on as-is, 75% on as-complete
- Max LTC
- 85%
- Pre-sales
- 50% qualifying by GRV (residential)
- Geography
- AKL · WLG · CHC · TGA · ZQN
- Asset types
- Residential · mixed-use · select office & light industrial
Residual stock & bridging
- Facility size
- NZD $3m – $25m
- Term
- 6 – 18 months
- Max LVR
- 70% on completed stock
- Use of funds
- Refinance senior debt · unlock equity · acquisition bridge
- Exit
- Documented sales program or term refinance
- Pricing
- Floating, OCR + 6.50–8.50% gross
- Fees
- Establishment + line + exit, all disclosed
Out of appetite
Land banks. Sites that don't yet have resource consent. Motels, hotels, anything where the asset is essentially the operating business. Specialised use — data centres, hospitals, marinas, retirement villages. Single-tenant industrial where the tenant happens to also be the developer. Anything outside New Zealand. Facilities under $3m. First-time sponsors without a co-sponsor who has already finished a comparable project with us.
The six questions, answered.
- Valuation policy
- Independent, registered valuer for every facility at origination. Quarterly re-valuation by an independent panel against the manager's NAV. Loans on watch list are valued monthly. We do not self-value.
- Fee structure
- Management fee 0.95% of NAV p.a. Performance fee 10% over OCR + 6.00% with a high-water mark. Borrower-paid establishment and line fees are passed through to the fund. We disclose every fee, including any related-party fee, in the monthly investor letter.
- Leverage
- None. The fund doesn't borrow against itself to inflate returns. We've watched what happens to credit funds that do.
- Liquidity
- 12-month initial lock-up. Quarterly redemption windows thereafter with 90 days' notice. Maximum 7.5% of NAV redeemable in any single window. Suspension trigger and gate rules are in the IM. We will not promise daily liquidity against multi-year loans.
- Concentration
- Single obligor cap 12% of NAV. Single asset type cap 65%. Single city cap 50%. Reported in the monthly letter.
- Reporting
- Monthly: NAV, distribution, portfolio summary, watch list. Quarterly: full loan-level report, fees-paid statement. Annually: audited financials by a Tier 1 firm. We treat watch list disclosure as a feature, not a flaw.
What can go wrong.
Credit
A borrower may default.
Our protection is the layered security and a conservative LVR. Our policy when it happens is to enforce, not extend and hope.
Value
Property values can fall.
We stress every loan at minus 15% on value. If it doesn't survive that test, we don't write it.
Liquidity
You can't get out instantly.
Quarterly redemption windows with 90 days' notice. Treat it as a multi-year commitment, or don't subscribe.
Currency
NZD can move.
The USD and AUD share classes are FX-hedged at fund level. The NZD class carries no FX risk if your home currency is NZD.
Concentration
One country, one asset class.
That's the strategy. We don't pretend to diversify by lending offshore. The IM is explicit about this and so are we.
Regulatory
Rules change.
NZ, AU, US, SG, HK regimes can all shift on us. We watch and we adapt. We don't chase the goalposts.
The IM is the document that actually matters.
Everything on this page is a summary. The Information Memorandum is the real document; wholesale investors can request a copy below.