Real estate private credit has emerged as a core component of investment portfolios—and its relevance continues to grow.

In this paper, Metrics Credit Partners explores the rise of commercial real estate (CRE) private credit in Australia, its resilience through economic cycles, and why it’s poised for sustained growth.

With private credit in Australian CRE more than doubling in the past four years and projected to grow another 85% by 2029, investors are increasingly turning to this asset class for its potential for stable returns, low capital volatility and portfolio diversification benefits.

Key insights include:

• Market Expansion: CRE private credit reached $86.6 billion in 2024, with forecasts indicating 85% growth by 2029.
• Investor Value: May contribute to portfolio diversification and potentially reduce sensitivity to public market fluctuations.
• Structural Drivers: Regulatory constraints have reduced bank participation in CRE lending, creating a persistent funding gap.
• Demographic Tailwinds: Australia’s projected population growth of 9.1 million by 2050 will drive substantial real estate demand.
• Portfolio Integration: May enhance traditional equity and fixed income allocations, with potential in improving overall portfolio efficiency.
• Manager Expertise: In a maturing market, experienced managers like Metrics play a pivotal role in helping investors manage risk through disciplined investment and portfolio diversification.

CEO Perspective

“Scale on its own doesn’t guarantee success, but in private credit, it provides a crucial advantage – you can better mitigate downside exposure, broadly diversify portfolios of loans, and act decisively with the support of an experienced team. 

That’s why I’m a big believer in investors partnering with an experienced manager who can use their networks to originate good quality investment opportunities and fully realise the benefits of Australian real estate private credit. It is also one of the few asset classes where a manager can demonstrate to investors how they’re proactively safeguarding investor capital.”

— Andrew Lockhart, CEO & Managing Partner, Metrics Credit Partners

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