In an environment shaped by years of historically low interest rates, the search for stable income and capital preservation has become increasingly challenging.

Today, many wealth advisors are expanding their clients’ investment horizons to include alternative asset classes — chief among them, private real estate debt.

As advisors to high-net-worth individuals, SMSF trustees, and business owners, helping clients to navigate an evolving market landscape has become increasingly complex in recent years. Most will describe their investment objectives in familiar terms: a reliable income stream, coupled with capital stability. Yet achieving this balance is no easy feat in the current climate.

• Low-risk investments such as government bonds and term deposits often deliver returns that fail to outpace inflation.

• Volatile equity markets, ongoing global uncertainty, and the speculative nature of some alternative assets (e.g., cryptocurrencies) introduce significant downside risk.

• Direct property investment remains a cornerstone of many portfolios, but it's often capital-intensive, illiquid, and difficult to diversify.

A Strategic Alternative: Private Real Estate Debt

Private real estate debt offers your clients a strategic, lower-volatility alternative to traditional income-generating assets. It allows them to participate in the real estate market without direct property ownership, while earning a predictable income stream—typically via monthly interest payments secured by first mortgages.

For advisors looking to optimise income generation within a diversified portfolio, this asset class warrants new consideration.

Understanding Private Real Estate Debt

Real estate debt is secured against a physical property asset – a residential, commercial or industrial building, or land. When a property owner takes out a mortgage funded through a non-bank or private lender, private investors effectively act as the bank – lending the capital to the borrower, in exchange for monthly interest and capital repayments. These secured loans are typically short-term (three to 36 months) and provide a fixed income stream via interest payments that could be higher than an equivalent fixed income investment.

Historically, access to this asset class was limited to private networks or institutional players. 

However, technology-led investment platforms like AltX are democratising access for wholesale investors. 

The AltX platform offers:

• In-house credit assessment and due diligence

• Full transparency over individual deals

• The ability to build a diversified debt portfolio, aligned with a client's income and risk objectives

Building Income Resilience in Client Portfolios

Wealth advisors are increasingly using private real estate debt as a core strategy for generating consistent income, especially for clients in or approaching retirement. For clients seeking greater income certainty without assuming equity-market risk, private debt can play a valuable role within a broader portfolio construction strategy.

As market volatility persists and inflation continues to erode the real returns of traditional fixed income products, private real estate debt offers an attractive combination of yield, security, and accessibility. It empowers wealth advisors to offer clients a more nuanced and robust income strategy — one aligned with long-term financial goals, while preserving capital in a risk-adjusted manner.

To learn more about AltX’s investment opportunities please get in touch. 

This content is provided for general informational purposes only and does not constitute financial, investment, or professional advice.