About Real Estate Investment Trusts (REITs)
REITs allow large numbers of small to mid sized investors to pool their funds to create a larger investment opportunity.
- Provide access to investment opportunities which are typically out of reach of the normal investor;
- Provide diversification opportunities to investors looking to diversify into property markets;
- Provide exposure to the real estate market via the assets the trust owns. This can result in capital appreciation;
- Provide a regular income stream during the life of the Trust.
CFMG is authorised to manage these funds which may hold the following types of assets:
- direct real property;
- financial assets ; and
- opportunity funds.
CFMG are continuously seeking to identify opportunities suitable to the CFMG investment model.
CFMG offers two very distinct categories of investment
1. Equity & Income Funds
2. Opportunity Funds
The specific investment criteria CFMG use to assess an asset for Equity & Income funds are:
- Forecast of a gross pre-tax return to investors (after all budgeted expenses) at an appropriate risk reward margin above the cash rate published by the Reserve Bank of Australia;
- Investment returns paid to investors quarterly;
- Debt finance at a conservative loan to independent valuation ratio;
- Tenancy profile must include quality tenants;
- Strong WALE with the term exceeding the minimum investment term prior to any option periods needing to be exercised
The investment criteria CFMG use to assess an asset for Opportunity funds are:
- Significant opportunity to ‘value add’ to the asset via Development Approval, capital works or re-zoning;
- Significant capital growth on the asset should ‘value add’ be successful;
- Forecast of a gross pre-tax return to investors (after all budgeted expenses) at an appropriate risk reward margin above the cash rate published by the Reserve Bank of Australia