WESTPAC Residential Property Trust has launched a new product offering investors a chance to invest in a 441 property portfolio worth $226 million.
Westpac Residential Structured Investments is targeted at self managed superannuation funds and aims to provide investors access to the capital growth associated with a residential property investment – but without the complications of direct ownership.
Ranging from houses to townhouses and units, the properties are located across six Australian states and territories and are all leased to, and managed by, Defence Housing Australia for an average period in excess of 10 years.
Westpac Funds Management’s fund manager Lance Vassarotti said WReSIs are open to all investors.
“However, the offer, a first for the Australian market, has been specifically designed to be suitable for self managed superannuation funds, where the focus is on a medium to long-term investment horizon.
“This is a great opportunity for investors who want access to longer term capital growth in the Australian residential property market for an outlay of as little as $10,000,” Vassarotti said. “Investors in WReSIs will not incur the upfront costs and ongoing management complications often experienced by direct residential property investors such as stamp duty, vacancy risk and regular maintenance,”
Investors will not receive cash distributions while they hold WReSIs, but will instead be entitled to a return based on 130% of the portfolio’s capital growth rate.
At maturity on July 01 2014, investors will receive their return in the form of units in the Westpac Residential Property Trust.
Vassarotti said a sale facility will be available at investment maturity should investors prefer to cash out their WReSIs rather than receive units in the Westpac Residential Property Trust.
“Residential property is a popular investment option for Australians and for good reason as it has historically delivered strong, long term, low volatility returns.
“But direct residential property investment requires a large outlay and self managed superannuation funds may not be able to access debt, or benefit from negative gearing,” he concluded.
Australian Property Journal
