Private Credit: The Asset Class of Stability Amid Global Turbulence

As global financial markets continue to face geopolitical shocks, elevated inflation, and mounting recessionary concerns, the appeal of private credit is surging—particularly among family offices seeking long-term wealth preservation and steady yield. Once a niche domain, private credit has matured into a core holding across sophisticated portfolios. And nowhere is this evolution more evident than in Australia.

A Strategic Pivot from Volatility

Across regions, family offices are actively recalibrating their portfolios. According to UBS’s 2025 Global Family Office Report, allocations to private debt doubled from 2% to 4% year-on-year, with a further planned increase to 5%. This shift comes at a time when traditional hedging tools—public equities and fixed income—are proving less reliable in navigating today’s “permacrisis” environment of trade disputes, interest rate uncertainty, and geopolitical risk.

Public markets remain volatile and increasingly synchronised, limiting diversification benefits. Private credit, in contrast, offers greater control, contractual cash flows, and security-backed downside protection. These features are particularly valuable to family offices seeking resilience without sacrificing returns.

Source: UBS Global Family Office Report 2025, pp. 12–13

Australia: A Beacon for International Capital

Australia’s private credit sector is gaining global recognition for its robustness and relative value. By the end of 2024, the domestic market had grown to AU$205 billion in assets under management.

International investors are taking note. Foreign capital inflows into Australian private credit are rising, drawn by high illiquidity premiums, a creditor-friendly legal framework, and a stable macroeconomic environment.

Source: Australian Bureau of Statistics; Alvarez & Marsal; Private Debt Investor, 2024

Family Offices: From Tactical to Strategic Allocation

The evolution in family office allocations reveals a deeper strategic transformation. Private credit is no longer just a tactical allocation for yield enhancement—it’s becoming a cornerstone of multi-generational wealth strategies. In Australia, family offices represented 40% of all active private capital investors in 2024, up from just 10% in 2020.

What’s driving this? A growing preference for endowment-style portfolios, the desire for bespoke solutions, and increasing comfort with private asset governance structures. For many families, private credit is not just about returns—it’s about alignment, transparency, and control.

Source: InvestorDaily, 2024; UBS Global Family Office Report 2025, pp. 6–10

Princeton Financial Services: Standing Apart in a Crowded Market

In a rapidly expanding sector, Princeton Financial Services (PFS) stands out for its decade-long track record of delivering consistent, risk-adjusted returns through its Property Income Fund and suite of SPV offerings. PFS combines institutional-grade governance—featuring an independent credit committee, trustee, and custodian—with nimble, boutique execution that prioritises investor alignment.

What truly differentiates PFS is its transparency and co-investment approach. Investors are not just buying into a product; they’re partnering in a platform where capital is allocated alongside the firm’s principals, fostering accountability and long-term alignment. With income yields above 10% from senior secured real estate credit, the strategy has become a preferred choice for wholesale investors and family offices seeking reliable distributions and capital protection.

Looking Ahead

As family offices embrace a “fortress balance sheet” mindset, private credit is poised to capture an even larger share of the alternative asset allocation pie. The Australian market offers a compelling combination of macro stability, legal security, and income resilience. Within this landscape, PFS is uniquely positioned to serve the sophisticated needs of family offices—balancing governance, flexibility, and returns.

In an era defined by uncertainty, private credit offers something increasingly rare: predictability.