Folkestone winds up Real Estate Income Fund
Folkestone’s Real Estate Income Fund at Wollongong has announced that its unitholders had voted in favour of the sale of the fund’s sole asset, a six level A-Grade office building, for $46.1 million and the wind-up the fund.
According to Folkestone Funds Management, a responsible entity (RE) for the fund, the property had been sold to a private investor at a 67.5 per cent premium to the April 2013 $27.5 million acquisition price and a 33.6 per cent premium to the last independent valuation at 30 June 2016.
Folkestone’s managing director, Greg Paramor, said: “Given the strong demand for high quality office assets from both domestic and international investors, we decided to take advantage of the strong market and sell the property ahead of the fund’s expiry in 2019”.
“The sale price reflects an excellent result for our investors who will receive approximately $1.80 for each $1.00 invested and an internal rate of return of 23.6 per cent per annum (post fees, pre-tax) since inception of the fund four and half years ago.
“The result validates Folkestone’s active management of its unlisted funds on behalf of its investors,” he said.
Folkestone Funds Management said it expected to receive a performance fee of approximately $2.9 million in November 2017 when the property would settle and the fund would be wound up.
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