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Pepper-backed offshore lender launches non-resident mortgages

A new offshore lender backed by a consortium of major investors has entered the Australian mortgage market and started funding non-resident mortgages.

Blue Lotus Loans this week launched itself as a new platform that provides financing for already-committed non-resident purchasers of Australian residential apartments.

The new funder is backed by a consortium comprising global real estate investors and credit providers including KKR, non-bank lender Pepper and Oaktree Capital Management, L.P. and is now accepting loan applications.

Daniel Pietrzak, a member of global investment giant KKR — which last year acquired non-bank lender Pepper — said that Blue Lotus is uniquely positioned to provide competitive financing options to non-resident buyers looking to settle FIRB-approved purchases of Australian residential apartments.

“We have great conviction in the long-term strength of the Australian real estate market and the important role that non-resident investment has in contributing to the overall supply of housing,” Mr Pietrzak said.

“Blue Lotus provides a real solution for credit-worthy international investors to settle on their pre-sale contracts to the ongoing benefit of Australia’s housing and construction industry.”

The announcement comes after a handful of non-bank lenders have started targeting the non-resident lending space, which was significantly impacted when the major banks largely pulled out of the market in 2015.

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Finsure-owned Better Choice Home Loans revealed late last year that it would soon be launching a home loan specifically for non-resident buyers of Australian property.

Meanwhile, Melbourne-based BC Securities, which is part owned by one of Hong Kong’s largest real estate players, told Mortgage Business that it is eager to use the third-party channel to distribute its new line of mortgage products.

BC Securities has launched a suite of mortgage products with a focus on non-residents, self-managed super fund (SMSF) borrowers and Australians who rely on overseas incomes. The company also offers a range of mortgage products from a panel of local lenders including the major banks and building societies.

The Melbourne-based group is owned by its Australian management team and Far East Consortium, a Hong Kong-listed real estate group with a market cap of $1.5 billion (HK$9.3 billion) and real estate projects across the globe.

[Related: Hong Kong-backed lender launches home loans]

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