Banner Property Income Fund
Delivers investor returns through investments in mortgages against Australian real estate.
The Banner Property Income Fund offers Wholesale Clients a strategic opportunity to invest in a pooled managed investment focused on Australian property debt.
By targeting a return of BBSW plus 6.5%, the Fund prioritises consistent income generation and capital preservation through a portfolio of registered mortgages over real property. The investment strategy leverages the expertise of seasoned finance and legal professionals who identify value within market dislocations, applying stringent lending policies and a macro-economic lens to asset selection.
Each investment is secured by first mortgages, with total exposure capped at a 75 per cent loan-to-value ratio based on independent valuations. The Fund enhances investor yields by utilising a subordinated debt structure while maintaining rigorous oversight via an Investment Committee. This approach ensures a diversified spread of risk across residential, commercial, and industrial sectors, providing a professionally managed pathway to the Australian property credit market.
Target Return
The Banner Property Income Fund will aim to provide income returns of BBSW plus 6.5%.
Returns are net to Investor and the BBSW rate is reset every quarter. The Target Returns are targets only, and the Funds may not meet their objective.
The Fund has been established to provide Wholesale Clients with an opportunity to invest in a pooled managed investment and to receive income from investments where the underlying security is registered mortgages over real property.
The Fund adopts a credit strategy which aims to realize value for Investors by acquiring investment positions in Australian property debt instruments, typically mortgages. The Trustee invests the assets of the Fund in accordance with the investment strategy and policies set out in the IM.
Units provide the Unit Holder with an undivided share of the Fund’s asset pool, but not an interest in any specific asset.
Certain rights are attached to the Units, and these rights are exercisable by the Investors who own the Units. The Fund’s investment objective is to provide income returns of at least the Target Return whilst preserving capital.
Any investment will be subjected to stringent lending policies, defined exposure to the property asset on a loan-to-value basis, and will be supported by underlying securities (such as guarantees).
Security
The Fund’s underlying investments are secured by interests in mortgages over real property (either directly, through Sub-Schemes or assignment of interests).
Distributable Income
Distributable Income is reinvested in Units for the Investor or, if elected by an Investor, paid Quarterly to the Investor’s bank account. Defined investment criteria Applied to prospective loans by the Investment Committee to reduce the risk of capital losses.
Professional management
The Trustee employs both a macro-economic view and an individual loan focussed asset selection process and seeks where possible to take advantage of dislocations within the Australian property credit market. The Manager employs a number of finance professionals, analysts, legal and property experts to actively manage all investments.
Oversight
The Manager’s and the Fund’s compliance with its asset selection criteria, procedures, financial performance and structure are overseen by the Investment Committee and the Board of the Trustee.
The Manager seeks to enhance Investor returns by acquiring investments in Australian property mortgages to a maximum of 75% of the property value as assessed by an independent valuer prior to the investment being made. The enhanced rate is achieved by allowing priority for part of the mortgage debt at lower rates, the benefit of which flows to the investors in this Fund.
Typically, the investment will be subordinated to monies owing under a low LVR Banner Fund loan which is limited to a 50% LVR (plus interest and costs).
The type of financial instruments in which the Fund may invest include, but are not limited to:
- Loans for the development or acquisition of Australian residential, office, retail, industrial or commercial property secured by first mortgages;
- Interests in Sub-Scheme mortgage loans;
- Investments in a Banner Sub-Scheme;
- Assignment of interests from other Banner Funds; and
- Other liquid securities to meet ongoing cash needs of the Fund.
It is intended that the Fund will create a spread of investments across property income funds and direct loans which will create a diversity of risk of investments.
Once the Fund has achieved $100 million of funds under management, a maximum of 15% of the Fund’s funds under management can be invested in any single investment.
Investment Criteria
The Fund invests in loans secured by property assets frequently which are undergoing planning or construction.
Origination of these loans for the Fund is the responsibility of the Manager and is undertaken by a team of Portfolio Managers who are responsible to investigate and prepare the investment proposal, and on-going loan management once the investment is made.
Primarily, the Fund’s investments will be secured by investments in loans where the underlying security is a registered first mortgage over Australian property assets, obtained through taking security directly or through Banner Funds loans or Sub Schemes.
The majority of the Fund’s investments will be interests in mortgages (through Sub Schemes) which are first mortgage secured with respect to the Fund’s investment.
In all cases, a first mortgage will be the underlying security. To ensure its security position, the Fund may also take supporting securities such as general security agreements, specific security agreements, priority or subordination deeds, company charges, personal and corporate guarantees, and side deed arrangements with builders. The Fund may invest in assignments of securities (or participation interests) where it is satisfied with the underlying first mortgage security position.
A minimum holding period of 12 months applies to Units issued by the Fund.
Unit Holders may request a redemption of Units any time after 12 months from the time those Units are issued to the Unit Holder, with 90 days’ notice to the Manager.
Redemption requests and approvals are always subject to the Trustee’s discretion and Fund liquidity at the redemption date.
Withdrawal Fee
A fee of up to 5% plus GST of the total value of units redeem may be charged by the Trustee to the relevant Unit Holder for redemptions made within the first 12 months of the investment. After the Initial Investment Term, no fees apply to redemptions. This fee does not form part of the Fund.
Established in 2010, Banner has consistently delivered superior returns to its investors.
Investments include property specific investments secured by a single asset and a number of pooled funds offering differing risk and return to match investor risk and return appetites. Banner adopts a consistent and rigorous approach to its appraisal of each potential investment, with a detailed due diligence and adoption of risk mitigation measures specific to each transaction.
We focus our investments in the major population centres of Australia’s East Coast, which have greater underlying market depth and liquidity.
Banner also offers experienced wholesale investors with higher yielding investments such as equity participations in development projects. All investments are actively managed by Banner throughout the investment term through to repayment of the investment.
Andrew founded Banner Asset Management in 2010, with a vision to establish a truly independent lender with an original view. With 25 years of experience in Global Financial Markets behind him, Andrew set up one of Australia’s independently owned private investment firms specialising in real estate, with his investor-first approach shaping the ethos of the company to this day. Andrew has extensive banking and financial expertise, with a long track record of working in capital markets. He has worked in London, Tokyo and Australia with leading international financial institutions and has been investing in alternative real estate opportunities since 1998.
Andrew is a voting member of the Banner Investment Committee, a member of the Banner Funding Committee and also an owner of Melbourne United.
Brett has over 30 years of experience in funds management and law, including over 20 years’ as partner in several Melbourne based legal firms and an international consultancy practice. Brett has an extensive track record of representing international and local banks, listed corporates, funds and private financiers. Throughout his career, Brett has specialised in finance and the funds management industry and has owned and operated managed funds. As Group Legal Counsel at Banner, Brett works across legal, business structuring, compliance, lending, investor publications and establishing new funds, in addition to a broad range of roles within operations.
Brett holds a Bachelor of Economics and a Bachelor of Laws. He is a compliance officer, responsible manager and a member of the Banner Investment Committee and a director.
Jeremy has been an active investor in international real estate since 1986. He has 27 years of experience in the international money markets, specialising in managing interest rate options groups. Since 1989, Jeremy has held director and senior management positions in leading brokerage companies in Hong Kong, London and Tokyo. He is currently a principal of Estuary LLP, a fund specialising in Argentine agricultural and construction investment trusts.
Jeremy is a member of the Banner Investment Committee.
Matt has over 25 years experience in the property industry having held senior roles for public companies and consulting to high net worth family offices and landowners, driving strategic town planning initiatives and managing individual development projects and portfolios throughout the project life cycle. He has developed projects in his own right and has worked on, repositioned and delivered a wide variety of assets from industrial, commercial, retail, land subdivision and medium density housing, as well as infill and brownfield sites with complex town planning and remediation matters.
Matt is a voting member of the Banner Investment Committee.
To receive further information in relation to Banner Diversified Real Estate Credit Fund Reports, please click here to get in touch directly with our investor relations team.
Statutory Statement
This offer of scheme interests is available to wholesale clients only. This product listing was vetted by and approved by the product issuer identified above before publishing. Investment Markets (Aust) Pty Ltd AFSL 527875 (IM) is not the issuer of the product.
General Disclaimer
IMPORTANT STATEMENT ABOUT YOUR USE OF THIS SITE
Information on this site is intended for Australian users only.
This site is operated by Investment Markets (Aust) Pty Ltd. (ACN 634 057 248) (IMA, we, us and our), the holder of Australian Financial Services Licence (AFSL) no. 527875. The content is provided solely for information purposes, is not a recommendation or an offer to buy or sell a security, and is not warranted to be correct, complete or accurate. To the extent permitted by law, neither IMA, its affiliates, nor the content providers (such as the issuers of securities who appear on the site) are responsible for any investment decisions, damages or losses resulting from, or related to, the content, data and analyses or their use. The investment products on this site and any statements made about them by their issuers are not vetted, verified or researched by IMA. The presence of an investment product on this site should not be interpreted as an implied endorsement of it by IMA. Certain content provided may constitute a summary or extract of another document such as a Product Disclosure Statement. To the extent any content is general advice, it has been prepared by IMA. Any general advice has been provided without reference to your investment objectives, financial situations or needs. For more information refer to our Financial Services Guide. To obtain advice tailored to your situation, contact a financial advisor. You should consider the advice in light of these matters and, if applicable, the relevant Product Disclosure Statement (or other offer document) before making any decision to invest. Past performance does not necessarily indicate an investment product’s future performance. The content is current as at date of initial publication and may not be current as at your date of viewing. For a more complete understanding of all the terms and conditions of your use of this site click here.