Mar 20 2018Add to Favorites
More private investors will have access to individual, first mortgage secured loans, which produce a monthly income, via an online platform launched by Balmain Private.
The loans are backed by commercial real estate that has already been credit approved and settled by Balmain, Australia’s largest non-bank commercial loan manager.
Balmain Discrete Mortgage Income Trusts will enable investment in the loans, which are fixed term, the Trust requires a minimum investment of $50,000 from which investments in individual mortgages can be made for $10,000. Terms range from a few months up to three years.
The Trust structure allows investors to create their own portfolio of discrete first mortgage commercial loans, either directly, or via their Self-Managed Super Fund (SMSF) or financial adviser, by selecting one or more loans that suit their individual needs, in terms of risk, returns and terms.
Individual loans are diverse in all aspects, offering returns ranging from 5.6 per cent p.a to 11.2 per cent p.a, with the average net return from loans settled and repaid so far sitting at 7.86 per cent p.a.
Of those loans, 46 per cent have exceeded their Target Rate of Return, while the remainder met theirs.
Making this offer unique is that it’s delivered online, allowing investors to choose their investments and terms, and manage their portfolio via an investor or advisor control console.
This means investors can transact at their convenience via the paperless system, which provides daily reporting, regular updates and complete details of capital movements, including income distributions.
The type of assets are all commercial loans and security has so far included commercial offices, industrial, retail, residential and land, located in Queensland, New South Wales, Victoria and the ACT, with new loans being added regularly.
Home loan approvals have fallen significantly off the back of the APRA and the Royal Commission initiatives together with new Responsible Lending Criteria. The ABS recently reported that home loan approvals have fallen by 13.6% year on year and within that, investment loans have come back by c.20%
Off the back of successfully settling a $48m syndicated first mortgage for a residential apartment development in Sans Souci just weeks ago, Sydney-based real estate investment manager Centennial Property Group (CPG) opened a new fund with a focus on the industrial and logistics market, Centennial Industrial and Logistics Fund II (CIL II). The fund, available only to wholesale and private high net worth investors, opened on 1 November and was seeking to raise c. $38 million. CPG closed the fund less than two weeks later, well before the official close date, due to oversubscription.
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