ICAM Diversified Seniors Living Fund

The ICAM Diversified Seniors Living Fund (“IDSLF”) is an open-ended diversified Fund created with the aim of providing investors with reliable yields, strong capital growth and reduced risk via geographic diversification through a pipeline of seniors living assets located across Australia and sourced off-market via ICAM’s industry networks.

Founded in April 2022, the Fund will target assets in differing stages of their lifecycle, including mature operating assets, newly developed operating assets and may undertake full or partial development of assets where risk adjusted returns are complementary to the Fund.

The Fund has been created to capitalise on Australia’s demographic trends. As the population ages, a generational opportunity is emerging to capture the resulting demand for seniors living accommodation. Combined with a chronic undersupply of seniors living accommodation across Australia the Fund aims to acquire assets via off market transactions at high discount rates and with significant aggregate valuation upside.

The Fund currently has two wholly owned retirement village assets with a total of 276 independent living units and apartments. The seed asset for the Fund was Langton Park, a well-established retirement village located in Adelaide’s eastern suburbs. The fund’s second asset is The Elms Retirement Village located in the semi-regional town of Kilmore in the northern growth corridor of the Melbourne metropolitan area.

The Fund has a strong pipeline of diverse off market acquisitions and intends to build a fund size of $150M-$300M with 10-15 assets nationally

• A proven investment strategy underpinned by strong demographic tailwinds providing exceptional returns to investors.
  
  
• An open-ended Fund, providing investors with exposure to all current and future assets within the Fund.
  
  
• An opportunity for investors to increase their holdings as the Fund continues to acquire more assets, with annual equity raises expected to occur.
  
  
• The Fund is targeting a distribution of 8% pa (average over five years) paid quarterly to investors. Target IRR of 14%+, representing an extremely attractive expected return to investors.
  
  
• Low levels of gearing across the Fund minimising the impact of current and future interest rate fluctuations.

As Australia’s population ages, a generational opportunity is emerging to capture the resulting demand for seniors living accommodation.

Advancements in healthcare are enabling Australian seniors to live independently for longer, creating a robust long term demand outlook for retirement living accommodation.

With seniors living accommodation supply struggling to meet this heightened demand, and the development pipeline slowing due to high construction costs, existing seniors living assets are experiencing high levels of demand for their stock, driving elevated prices.

Despite these strong demographic tailwinds, discount rates for seniors living assets are yet to compress to the degree seen in other property asset classes such as commercial office, industrial, segments of retail, and even residential property, presenting a highly attractive relative value opportunity.

The discount rates for these assets also tend to be less affected by rising cash rates as gearing is typically lower.

The key focus for ICAM as the Asset Manager for the Fund will be to utilise it extensive networks to acquire targeted off-market senior living assets across Australia and to actively manage these assets to derive the maximum value from the investments. Where possible ICAM will employ initiatives such as upgrades, repositioning, expansion or development of assets. The Fund does not intend to invest in Aged Care which is a different area and governed by different regulations and legislation. 

The Fund will also look to take advantage of obtainable synergies across its asset base to manage costs and provide stable distribution yields to investors.

The Investment is intended to be open-ended with an opportunity for investors to seek redemption of their investment after 7 years from the Fund’s inception (liquidity event in April 2029) and every 3 years thereafter.

Withdrawal Rights 

There are no withdrawal rights from the Trust. An investment in the Trust is illiquid and should be viewed as a long-term investment.

The Trustee may, to the extent it can reasonably do so, assist an investor to transfer their Units by facilitating introductions to other investors or third parties who may be prepared to acquire the units on terms to be negotiated between them. However, there can be no guarantees that a buyer can be identified.

This document (“Information Presentation”) has been prepared and issued on a confidential basis by Inheritance Capital Asset Management Pty Ltd (ACN 608 095 030) (AFSL 481118) (‘ICAM’) and is dated July 2023. The information contained in this Information Presentation shall be treated as strictly confidential and shall not be directly or indirectly disclosed to any other party or reproduced, in whole or in part, without the prior written consent of ICAM. • This Information Presentation does not constitute, and should not be taken to constitute, in any jurisdiction, financial advice (whether general or personal) or a recommendation or statement of opinion (or report on either of those things) intended to influence a person to make a decision in relation to any financial product or instrument or an invitation, offer, or solicitation or inducement to buy or sell any financial product or instrument, or to engage in or refrain from engaging in any transaction. • ICAM does not make any representation or warranty, express or implied, as to the accuracy or completeness of the information in this Information Presentation or any person’s legal, tax or accounting treatment of the matters described herein. • To the extent permitted by law, ICAM and its related bodies corporate, officers, employees, agents, advisers, contractors and members (a) disclaim any and all liability relating to this information, including, without limitation, any express or implied representation for statements and conclusions contained in and omissions from this information; and (b) accept no liability (whether in negligence or otherwise) for any loss, damage, costs or expenses of any nature which may be suffered or incurred by any person relying on any information or statement contained herein or otherwise arising in connection with any such information or statement. This Information Presentation is distributed in Australia for use only by wholesale clients as defined in s761G of the Corporations Act 2001. • This Information Presentation may contain forward looking statements which are not based solely on historical facts but are based on current expectations about future events and results.  Such forward looking statements are based on views held only at the date of publication of the material and are not guarantees of future performance or events.  These forward looking statements are subject to inherent risks, uncertainties and other factors, many of which are beyond the control of ICAM.  Accordingly, actual results may differ materially from those expressed or implied in such statements.• ICAM does not undertake to update any forward looking statements to reflect events or new information following the publication of forward looking statements in this Information Presentation.  ICAM gives no representation or warranty (express or implied) as to the completeness or reliability of any forward looking statements. • Past performance information is not a reliable indicator of future performance. Any reference to past performance in this Information Presentation is intended to be for general illustrative purposes only.