Challenger to restructure Howard Mortgage Fund
Challenger has put forward a so-called five-point restructuring plan for its 25-year-old Howard Mortgage Fund.
The plan, which would see approximately $850 million in withdrawals made available to its investors, would be subject to members’ approval at a unit holder meeting next month.
The company also proposed the release of an additional 10 per cent of net assets to fund redemptions, and the recommencement of commercial lending.
Challenger’s joint chief executive for funds management, Rob Adams, said the Howard Mortgage Fund would recommence commercial lending at a time when “very attractive lending opportunities are available due to prolonged credit supply constraints”.
“We hope to quickly restore the premium to cash rates traditionally enjoyed by Howard investors over its first 24 years of operation,” Adams said.
The company's distribution teams have been contacting dealer groups and platforms this week and the proposal was met with a very positive response, according to Challenger.
Challenger claims Howard Mortgage Fund is the largest mortgage trust and also the first to unfreeze since the fund was frozen in October 2008.
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