Property Collect harnesses their extensive network of agents, developers, builders and referrers to source the best property and development sites
The direct alternative to the outright purchase of residential investment property
Collective investment (syndication) to achieve economy of scale with ‘BuyPower™’ and ‘BuildPower™’
Purchasing apartments or houses at wholesale price using ‘BuyPower™’
Developing apartments or houses on a specific property at cost price using ‘BuildPower™’
Investors receive rental return and capital growth just like outright property ownership
No personal debt and no personal liability. Property Collect leverages directly with the bank
Affordability – can invest from $2,000
Spreading of risk as investors collectively own a number of properties
Professional management performance incentivised to optimise returns
Clear exit structure – not often the case in many other syndicates
Taxation benefits and tax effective structure such as depreciation and CGT
Strict compliance legislation with a Product Disclosure Statement registered with ASIC
Q Who can invest?
Companies and trusts
Q What do I gain from registering with Property Collect?
Insightful property education
Cutting edge research
Site visits/specialized seminars
Unique investment opportunities
Q What returns are expected?
Property Collect, like buying investment property outright, takes advantage of bank leverage
Generally the maximum bank LVR is 50% so conservative borrowings are adopted
Target returns are forcast at 10% per annum plus, in line with the Russel ASX Long Term Investment Report 2018 analysis
The return comprises rent plus capital growth
Plus the benefit of a tax effective structure
Q Is it safe?
The investors in the trust own the ‘bricks and mortar’ with a Registered ASIC Custodian
There is an ASIC approved Responsible Entity with a detailed compliance plan
Investors have sole discretion over asset selection – ‘SelectPower™’
Only professional and experienced management is appointed
Property purchase or development at ‘wholesale or cost price’ increases security
There is regular reporting and strict accountability
Acquisitions are thoroughly researched with independent valuations
Investment risk is spread over a number of properties
Q What is the investment structure?
Investors subscribe to units in a trust with an ASIC registered custodian
As it is a ‘pooled investment’ of investors’ funds a Product Disclosure Statement (PDS) is required
This PDS is registered with ASIC by the Responsible Entity of the trust
The Responsible Entity lodges a Compliance Plan with ASIC for the trust
The Responsible Entity appoints various specialists to undertake duties such as asset management
The Responsible Entity will ensure regular reporting and accountability
The Responsible Entity and advisors make operational decisions
Q What does Property Collect offer with built residential investment property? (BuyPower™)
The opportunity to acquire property at ‘wholesale price’ due to ‘BuyPower™’
Ability to diversify within the same residential trust – across a city, cities, states.
Risk mitigation strategies of rental and capital growth with multiple properties
Q Why develop residential investment property – is that not risky? (BuildPower™)
A strategic benefit of property development for Property Collect is for investors to acquire property ‘at cost’ with acquisition at cost base meaning ‘future risk’ in value erosion is minimised due to ‘BuildPower™’
Opportunity to achieve ‘economy of scale’ by building multiple than single
In development the most risk is ‘sales risk’ and the Property Collect model eliminates that
It is important that the development management has warranties and guarantees of product delivery
No investors funds are utilised until strict development preconditions are met
Property ownership by investors at cost through development means optimal opportunity to maximise rental and capital growth returns on capital invested
Q How and when are returns paid?
Residential property investment is often a long term rather than short term investment strategy
Returns are received from property rental and ultimately capital growth though sale
Generally the residential investment property trust will have debt up to 50% of value to obtain the benefit of ‘debt leverage’
Hence, as like outright ownership, rental income in early years is used to pay rent and costs
As rental surpluses occur this is passed back to the investors
All assets are then sold so investors can benefit from the capital growth
Q Is there an early exit structure?
Yes, a comprehensive early exit structure is in place and fully described in the PDS
The trust targets to maintain a cash reserve for urgent redemptions
Plus, property can be sold to allow investors to exit as in outright ownership
Q Are there risks?
Any investment entails risks and all investors should get investment advice
The following risks are the same as if residential investment property was owned outright
There is the risk of property prices falling due to economic conditions
There is the risk of rental returns falling due to economic conditions
There is the risk of poor management
There is the risk of poor asset sale decisions
Q How are these risks mitigated?
The investors own the ‘bricks and mortar ‘through a strict ASIC compliance structure
There is a dedicated ASIC approved Responsible Entity
Detailed research of all investments and independent reports and analysis is undertaken
There is an experienced and skilled professional management team
There is strict monitoring of rental management
There is strict property maintenance
There is the opportunity to sell down property over time to reduce risk
Q What are the taxation benefits?
Being a trust, both income and taxation benefits can be passed directly to the investor