Expand your portfolio by investing in Residential Syndication

Point’s sister company Erskine + Owen, New Zealand’s first Buyers Agent, recently launched its residential syndication program. Residential Syndication provides a new path way for investors to expand their property portfolio.

Today’s market has multiple challenges for property investors, LVR restrictions and the general tightening of retail bank lending requirements have in some instances made direct investment in property more prohibitive.  Syndication, in its simplest form is the pooling together of wholesale investors to access property that they couldn’t have purchased alone or may not have wanted to.

Some of the key benefits of syndication are

Exposure to key growth areas in New Zealand (i.e. Auckland, Hamilton and Queenstown) for a much smaller investment that if you invested directly;
a. Through the investment structure, your liability is limited to the equity you put in;
b. Your money is exposed to sensible leverage, generally between 40 and 50%;
c. Erskine + Owen undertake all the work, from buying the property, undertaking due diligence, arranging the finance, with Point managing the portfolio.

Erskine + Owen have recently completed the first syndication in Hamilton and was oversubscribed. This was a 31-room commercial/residential hybrid with a forecast net return of 7%. The second syndication, located in Queenstown is about to go unconditional and is forecast to have a net yield between 6 and 7%.

It was clear from conversations with interested parties that some thought they would not qualify as a wholesale investor, when infact they may well have. See this article for discussion as to the different wholesale investor categories.

To be added to the mailing list for future syndications or for more information please e-mail syndication@erskineowen.co.nz and in the subject line write “Syndication (Point) – Information”.