Gallantree is set to become Australia’s first CLO issuer as it prepares to launch CRE CLO I, sized at AUD 1.16bn, according to sources familiar with the matter and confirmed by the company.

The CRE CLO is a precursor to other structured credit strategies such as a corporate credit CLO in Q2 2026, alongside a CFO linked to fund of funds, according to a pitchbook seen by 9fin.

The Brisbane-headquartered firm is understood to have been scouting out US arrangers at the Opal CLO Summit in Dana Point last week and the firm is expected to open its first warehouse in the coming weeks.

Several US banks remain in contention, sources say, reflecting the firm’s view that Australia lacks sufficient capital markets access.

Gallantree will effectively act as a co-arranger, leveraging offshore investor relationships.

In addition, Gallantree is understood to be looking to boost the team with a dedicated experienced CLO portfolio manager, while also adding around five people to its credit team and structuring teams. The firm has CLO experience in the form of Paul Michowicz (director of securitisation and treasury), who has a background of structuring and trading CLOs, ABS, MBS at firms such as Bankers Trust and Advisors Asset Management.

The initial CRE focus is deliberate.

“CRE CLO makes sense in Australia since most private credit firms in Australia have large real estate portfolios compared to US private credit firms,” said Brett Hales, chief executive officer of Gallantree. “Local banks have a fairly comprehensive CRE portfolio and due to Basel III, which has been in the region since 2023, capital adequacy is higher in certain pockets and CRE is a massive capital drag on balance sheets.”

“Correct options for banks would be to sell it to a large asset manager, but most banks want the relationship as well so that hasn’t been fortuitous.”

Gallantree has built its own platform from scratch across loan management and servicing, credit underwriting, securities issuance and management. The team designed and built trustee infrastructure after determining that existing Australian trustee providers lacked the infrastructure necessary to accommodate the dynamic nature of CLOs and multi-originator structures.