Labassa Capital Credit Fund Update May 2026

In May 2026, the Fund achieved an investor return of 10.52% p.a. net return of fees on a 12-month rolling basis. The portfolio LVR was maintained at 52.55%. The Fund has made a full distribution of interest received for the month, with 100% of the loans being serviced.

The Fund has maintained its existing investments in May. Two partial loan repayments are expected in June, and two new residential land subdivision investments are at the final stage of due diligence, with settlement scheduled for June.

Federal budget and market outlook: The Federal Budget (May 2026) introduced several property-related measures, including the removal of the 50% capital gains tax (CGT) discount for foreign residents and tighter foreign ownership reporting requirements. These changes may reduce foreign buyer activity by 5–10% in FY27, potentially softening demand in select markets, although a material impact on broader property values or development activity is not expected.

Capital allocation perspective: The removal of the CGT discount for foreign residents may support increased investor allocation toward private credit as an alternative to direct property ownership. Private credit continues to offer contractual cash flows and no immediate CGT event on entry or exit, providing a differentiated risk-return profile relative to direct property investment in the current tax environment.

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