The Zagga Commercial Real Estate Debt (CRED) fund has been officially registered as a foreign investment trust with the Financial Services Agency (FSA) of Japan in response to the growing appetite for alternatives as a hedge against market volatility.

According to the non-bank lender, this “important milestone” will support a growing group of Japanese investors seeking access to private real estate loans in Australia for their income generating, diversification and hedging characteristics.

It will also complement the firm’s current investment channels in Australia and Singapore.

"Zagga CRED Fund's registration as a foreign investment trust with Japan's FSA is a logical extension of our desire to attract investors from outside Australia, and in particular from Southeast Asia," said Alan Greenstein, CEO of the boutique investment manager and non-bank lender.

"This move complements our Singapore sub-fund and expands our direct investment offering to a broader base of Japanese investors seeking access to the same defensive and income-generating potential that resonates so well with our Australian investors."

The Zagga CRED Fund invests strategically in a select portfolio of credit-checked, mortgage-backed loans in the commercial real estate sector.

Since its launch in August 2023. it beat its target net return of the official cash rate plus 4 percent a year for wholesale investors with a minimum investment of $50,000.

It is currently available on major platforms including Netwealth, Praemium, Dash, HUB24 and BT Panorama in Australia.

By the end of August 2024. Zagga's total startup capitalization is close to $2 billion, while maintaining an average return to investors of more than 8 percent annually since inception in 2016.

It witnessed its highest-ever inflows for the first quarter of the 2024–25 financial year, as well as record inflows, with a portfolio of around $400 million.

Zagga's Chief Investment and Risk Officer, Tom Cranfield, recently joined an InvestorDaily webcast about navigating the rise of Australia's CRED. To learn more, click here.