Inside the shift from 60/40 to private alternatives

Fear and Greed Interview: Inside the shift from 60/40 to private alternatives

Source: Fear + Greed
Date: 28 April 2025

There’s been a surge in interest in private credit in recent years, even before volatility in equity markets reminded investors about the value of diversification and defensive assets.

Tom Cranfield, Zagga’s Executive Director, Risk & Execution, takes Sean Aylmer through the rise of real estate private credit:

“The original shift was driven by a change in regulatory rules. And that saw the banks change the amount of market share which they wish to have, particularly with regard to real estate. So project financing, which we are most exposed to… is very strong on providing construction finance to established developers within the middle market.

For us, that segment of the market, which had traditionally been dominated by the four major commercial trading banks in 2015, 2016, they started to recede their market share. And it’s the growth of that, driven by the withdrawal of the banks, that has established the private credit sector because you can get the returns in a manner that we believe to be safe, stable, consistent.”

This article is for information purposes only. It does not take into account your objectives, financial situation or needs. Any opinion expressed in this article are of the author and is subject to change without notice. Readers are reminded to exercise caution and use their own judgment when interpreting and applying the information contained in this article.

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We would like to acknowledge the Traditional Custodians of the lands, seas, and communities in which we provide our services. We would also like to pay our respects to the Elders past, present and emerging, and the continuing cultural influence they have on Australia.

Zagga Market Pty Limited (Australian Credit Licence 490904) ACN 611 662 401 acts as the Servicer of loans acting on behalf of the credit provider, Zagga Investments Pty Limited (AFSL 492354) ACN 615 154 786, trustee of the Zagga Investments Lending Trust

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All portfolio numbers quoted correct as at 31 January 2025.

*Average investor return across the active portfolio as at 31 January 2025.

**Target return is after expenses and any applicable management fees for the year ending 30 June 2024. OCR = Australian Reserve Bank Official Cash Rate.

Past performance is not a reliable indicator of future performance and investments are subject to investment risk, fees and costs. Returns are not guaranteed.

Prospective investors wishing to invest in a Zagga direct investment or a Zagga Fund should fully consider the Information Memorandum, ZFF Fact Sheet and/or ZWF Brochure, available from Zagga, before applying to invest. Investments are subject to risks.

Articles on this website have been prepared by Zagga Investments Pty Limited (AFSL 492354) ACN 615 154 786 (Zagga) for information purposes only. It doesn’t take into account your objectives, financial situation or needs, nor is it intended as a substitute for any accounting, tax or other professional advice, consultation or service. Nothing in this article shall be construed as a solicitation to buy or sell any financial product, or to engage in or refrain from engaging in any transaction.

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