New fund to give SMSFs access to award-winning office investment
Fund manager, Placer Property, is seeking $26.5 million in equity from self-managed superannuation funds (SMSFs) and individual investors for its NewActon East Property Fund.
The fund has invested $46 million in the NewActon East building, home of the Australian Competition and Consumer Commission (ACCC) head office in Canberra's CBD.
Placer's head of investment, Shane Dudley, said the investment would provide a regular and reliable income, with an initial return of 7.75 per cent to be paid quarterly.
The property has a long 9.2-year weighted average lease expiry by income and a high occupancy rate of 98.5 per cent — with almost 80 per cent of the property's income being coming from the ACCC.
"The 7.75 per cent yield is attractive, particularly in this low interest environment," Dudley said.
"The fund gives investors access to an investment they couldn't buy on their own being a large A-grade building with quality tenants."
Dudley said the fund reflected the growing demand from SMSFs for unlisted property investment opportunities.
He added that the fund's minimum investment of $10,000 gave SMSFs the chance "to properly diversify while still gaining access to quality property investments".
The NewActon East Property Fund has an investment term of seven years. The fund's gearing is 49 per cent and the fund's interest rate exposure is expected to be 100 per cent hedged for the debt term of five years, adding further stability and reliability to the investment return.
AUTHOR
Nicholas O'Donoghue
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