Jun 13 2018Add to Favorites
With the global interest rate environment at all-time lows and banks paying a meager annual rate on savings, which is typically lower than the inflation rate, investors are having to search for opportunities to make their capital work harder. Balmain Private has created a digital concept where the group originates low Loan to Value (LVR) senior debt for real estate assets, which investors can then participate in via a digital platform. Balmain Discrete Mortgage Income Trusts provide investors the ability to invest alongside or “pari-passu” to Balmain, in individual, first mortgage secure loans.
Managed entirely online, the loans have already been originated, approved and funded by Balmain, are fixed term and get a significant participation from Self Managed Super Funds.
“We have over $200,000,000funds under management currently with about 950 individual investors,” Says Balmain Private head of Distribution, Tom Sherston.
“The minimum investment in any loan is $10,000, with typical terms ranging from a few months to three years, with the average net return so far sitting at 7.86 percent, paid monthly”.
Of the Loans repaid 46 percent have exceeded their Target Rate of Return, while the rest have met theirs.
A residential investment in Brookwater, Queensland, of $5,000,000 over three months, earned a return of 10.34 percent, based on a Target Rate of Return of 7.65 percent. Security on the loan was a first registered mortgage General Security Agreement (GSA), guarantees and indemnities from the director and related entities.
In Wetherill Park, NSW, an investment into a commercial development site met its 10.50 percent Target Rate of Return, following a three-month term. The loan amount was $4,471,000, with an LVR of 62 percent.
A $2,700,000 loan on a commercial/residential investment in the ACT exceeded its 10 percent Target Rate of Return, earning an actual return of 11.25 percent over a four-month term.
In Greenvale, Victoria, a $2,100,000 loan over a five-month term, met its Target Rate of Return of 7.6 percent. The security on that loan was a first registered mortgage, GSA, personal guarantees for the full amount of the loan plus interest.
Qualitas' first "pure property debt" listed investment trust, the Qualitas Real Estate Income has raised another $35 million in funds to issue more commercial loans.
Commercial property isn’t a pure income asset class like cash or fixed interest but it has a few advantages over other forms of income-based investing, starting with the yield. Right now, the APN AREIT Fund, for example, offers a distribution yield of 6.08%, paid monthly.
The Centennial Industrial and Logistics (CIL) launches its latest Enhanced Value fund will follow on from the success of the CIL I and CIL II funds which currently own 6 industrial and logistics properties across Brisbane and Melbourne totalling around $90 million in value.
Creating an account with MP Report allows you to save articles and update your preferences to filter the content based on your interests and what content you would like to receive from us via our email alerts and newsletter.SIGN UP HERE >