CrowdProperty Australia, an online marketplace lending platform providing finance to small-scale property developers, has rolled out a new fund for wholesale and institutional investors.
The fund provides specialist finance to Australia’s small-scale residential developers – a sector typically underserved by traditional finance. It invests in property project loans with target interest returns of up to 8.25% p.a. after fees.
David Ingram, CrowdProperty Australia CEO, said the fund will enable wholesale and institutional investors to diversify and de-risk investments through an established platform.
“Our specialist property team directly originates projects and conducts a rigorous 57-step due diligence process on all loan applications, typically funding only 4% of applications received,” Ingram said. “As a first mortgage fund, we’re the most senior debt in the projects. Our portfolio includes projects in major east coast cities and Adelaide and the Partner Fund is spread across all projects, meaning it’s diversified by project type, loan term, and geographic location.”
For investments starting from $25,000, investors taking up CrowdProperty’s Partner Fund will get up to an 8.25% p.a. target interest return paid in quarterly distributions with a minimum six-month investment term. They will also get a concierge service in on-boarding through a limited power of attorney, enabling the CrowdProperty team to complete the registration process on their behalf.
Ingram said the Partner Fund was another way for SMSFs and other investment structures to diversify their portfolio.
“Recent data analysing SMSF investments showed that 43% of SMSFs are not diversified enough, going against the guidelines set by the ATO in 2020,” he said. “Investing in the Partner Fund allows SMSFs to build retirement wealth while maintaining a degree of liquidity as our loans run from six to 18 months.”
