Forward thinking. The Alternative Finance Fund.
The Alternative Finance Fund has been established to take advantage of increasing investment focus on capital preservation and income generation, and changes to Australian banking regulations, which are limiting the availability of commercial finance to quality property owners and developers.
Changing Bank and credit requirements are not temporary; they represent a permanent change to bank lending policies and mean that major Australian banks have begun operating with a significantly reduced lending appetite – and much tighter lending parameters. The Australian commercial real estate market is now starting to follow the trends of many overseas markets, with an increased focus on private financing.
The shortage of finance is also driving up the returns available to lenders – and as a result, the Alternative Finance Fund is able to target a return of 9% per annum* (after fees and expenses) whilst investing in first mortgage loans.
About The Fund.
The Fund is an open, pooled investment vehicle for wholesale or professional investors. Amounts raised from investors are jointly invested in a portfolio of loans that have undergone a rigorous process of due diligence and credit analysis.
As individuals, investors are generally limited to making modest investments in individual opportunities. By pooling the resources of many investors in an income fund investment, the Fund is able to participate in a diversified and balanced portfolio generally out of the reach of any individual investor.
Pooling also provides improved investment liquidity.
The Investor Benefits.
As a participant in the Fund, Investors are provided with a number of benefits. These include:
- Attractive returns: The Fund targets an annual return over the long-term of 9% per annum (post all fees and expenses)* which is a large spread between target Fund returns and investments held in low returning regular term deposit cash accounts.
- Regular income: Distributions are paid quarterly.
- First Mortgage security: The Fund invests in only loans secured by first mortgages, often supplemented by security over additional assets and personal guarantees from the principals of the borrowers.
- Access to off-market and exclusive opportunities: as a professional investment vehicle, the Fund has access to a continual pipeline of loan exclusive investment opportunities through its extensive independent national brokerage network.
- Participation in larger investment opportunities: by pooling the resources of many Investors, the Fund can participate in larger projects and therefore has a greater variety of opportunities from which to choose, many of which are out of the reach of individual investors.
- Diversification: the Fund invests in a portfolio of many loans, providing diversification by asset type, class, borrower, market location and entry timing.
- Improved liquidity: 60 day lock out period with investors generally have an opportunity to redeem their investment whenever any one of the Fund’s many underlying loans mature.
- Professional management: the Investment Manager has a depth of experience gained in all property sectors, including small and large development, structured finance, investment origination and funds management (see Our Team).
- Investment management: shareholders of the investment manager are aligned with Fund investors by significantly investing in the Debt Fund on the same terms and conditions as other investors and providing loan underwriting to mitigate risk on new investors diluting existing investors returns.
- External oversight: the Fund utilises the skills and experience of its Investment Review Committee, which includes a number of members with extensive experience at CEO and MD level in banking and development.
- Selective portfolio: the Fund invests in loans in the significantly undersupplied $5 million to $15 million size range, allowing the Manager to be extremely selective in its choice of lending opportunities.
- Capital stable investment: with equity markets experiencing high levels of volatility, and property markets looking overvalued, the Fund represents a more secure investment option, with a higher return* than traditional fixed interest alternatives.
Shareholders of the Investment Manager are aligned with Fund investors and have Substantial Investment in the Fund.
If you are an interested wholesale or professional investor, the steps to get started are:
- If you are not sure if you qualify as a Wholesale or Professional Investor, please see details on becoming a new investment client.
- Sign up via the enquiry form to receive the full Information Memorandum and we will contact you shortly thereafter.
- Or alternatively, telephone East Coast enquiries on + 61 3 8680 2490 or West Coast enquiries on + 61 8 9288 4590; and
- If we are not available to take your enquiry immediately, we will return to your call shortly.