Bluestone Group has linked up with the alternative asset manager Varde Partners to finance the New Zealand commercial property investment company, Irongate Property.The deal, which was announced on Friday, represents a diversification of the Bluestone business, which has relied on mortgage servicing and receivables management since the company's non-conforming lending and reverse mortgage businesses were put on hold during the financial crisis.Varde is a credit investor, specialising in distressed debt and special situations. It has been in business since 1993 and has offices in Minneapolis, London and Singapore.Varde is looking for opportunities in Australia and New Zealand and is working with Bluestone as a local partner. Bluestone has received funding from Varde for one of its previous deals, the acquisition of a portfolio of auto loans from Provincial Financial.The $45 million funding package will allow Irongate to repay a debt series maturing in July and provide finance for development of its assets.The funding is a lifeline for Irongate, which was part of the St Laurence Group and has reported losses for the past two years. Irongate's $200 million of assets are managed by St Laurence Funds Management.Bluestone chief executive Peter McGuinness said Bluestone would act as Varde's operating partner in the region. It did the due diligence on the Irongate deal.McGuinness said: "The opportunity in New Zealand is that there is a liquidity gap."Some of Irongate's assets are development properties and the company needs management support. We see an opportunity there as well."The funders have some equity upside on the deal. McGuinness said Varde had a flexible approach to deal making.