‘We don’t buy into the theory that the office market is dead’

By: Larry Schlesinger
Financial Review
Jul 16, 2020

Non-bank lender Merricks Capital has backed a recovery in demand for office space post-COVID-19, after providing $150 million of construction finance to ensure developer Alfasi Group can complete a speculative office development in Cremorne on Melbourne’s city fringe.

Alfasi, which also operates big construction and equipment hire businesses, had used its own funds to kick off construction of its 20,000sq m, A-Grade office tower at 510 Church Street last year.

However, when potential financiers pulled back from the project in the wake of the pandemic, Merricks – which is backed by the ultra-wealthy Liberman family – stepped in to provide finance through its Partners Fund, which lends capital raised from institutional and high-net-worth investors.

It is the second speculative office development in Melbourne that Merricks has agreed to finance. In November, developer Goldfields secured funding from the non-bank lender for a $300 million office tower in South Yarra.

“We don’t buy into the theory that office space is dead,” said Andrew Torrington, managing director of investments at Merricks Capital.