Waldorf Astoria in Sydney

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The deal comes as the non-bank lending sector continues to eat away at the big four banks’ market share in commercial property financing. Banks have pulled back from financing smaller construction loans to avoid risk in today’s volatile market. However, the bank partnering with Pallas remains a mystery. It refused to be named.

Pallas’ new fund, its sixth institutional warehouse facility, is its first in partnership with another bank. Previously it has funded similar loans using money provided by wealthy private investors.

The group had an unusually active quarter settling on $807 million of new loans in the three months to December. To date, the firm has written 949 loans in Australia and New Zealand worth about $7 billion. Construction loans under $50 million comprise about 40 per cent of its total loan book.

Deicorp deal

Developer Deicorp has secured planning approval to include 48 affordable apartments in its landmark Marquet & Mary project, a mixed-use tower in the heart of Rhodes in Sydney that is designed by Australian architecture firm FK.

The $463 million project gained approval as a state significant development under NSW’s Infill Affordable Housing provisions. They are designed to increase overall apartment numbers and provide much needed housing for essential workers.

Deicorp’s tower will have 274 apartments on top a four-storey podium with 3796 square metres of retail and commercial space, a community rooftop terrace and garden, and a residential courtyard.

Company founder Fouad Deiri said the project’s location in the heart of Rhodes and on the doorstep of Concord Hospital and Rhodes Station made it an attractive proposition.

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It’s chemistry

Fresh from the blockbuster $34 billion public listing of the Chemist Warehouse chain led by the co-founder Mario Verrocchi, a Hong Kong-based investor has sold a shop leased to the retail chain in Chatswood, in Sydney’s north, on a tight 2.9 per cent yield.

Private investment group NRG Pty Limited paid $17.3 million for the shop at 387 Victoria Road, in the heart of a bustling area which is being reinvigorated by Vicinity centres new-look Chatswood Chase mall.

Shead Property’s Bill Geroulis and Rick Sombroek advised on the sale. The pair are also working to sell the St George Bank building at 366 Victoria Avenue Chatswood where they anticipate a similar yield to the Chemist Warehouse. The bank has price expectations around $30 million.

Carolyn Cummins can be contacted at carolynannecummins@gmail.com.