A 6% per annum income – safe as houses
The Rushton Social Impact Fund (“Fund”) invests in unlevered, high-quality disability housing, providing a much-needed service for the community, as well as a reliable and consistent income stream of 6% per annum for investors, i.e. 1.5% paid quarterly.
There are estimated to be 6,000 young people with disabilities living in aged care homes and thousands more in shared wards in hospitals – because there is currently no appropriate housing for them in areas where they feel comfortable and with compatible occupants. Another 78,000 disabled individuals are estimated to be living at home with ageing parents who just can’t cope and need assistance.
An investment in the Rushton Social Impact Fund (“Fund”) will help address this urgent situation, providing a substantial improvement in the quality of life for disabled people and at the same time, providing a solid income stream for investors.
Wholesale investors have a unique opportunity to invest in a high cash flow yield investment, underpinned by unlevered residential property (i.e. the fund does not borrow) and long-term leases, which are in turn, supported by a long-term government funding initiative.
Reduced correlation to the returns from shares
The most effectively managed investment portfolios combine a range of very good investments that are lowly correlated to each other, which provides true diversification benefits, and adds considerable value to the overall investment portfolio. It is even more important to ensure that these low correlations are sustainable over time – even under the worst possible economic conditions, i.e. when asset prices are falling, and the diversification benefits are needed the most. By combining lowly correlated investments that each produce an acceptable risk-adjusted return over time, it is possible to enhance investment performance without increasing overall risk.
How is disability housing different from normal residential property?
Each of the properties we provide are architecturally designed to ensure disabled tenants are provided with the most appropriate accommodation for their particular needs. Typical features include:
- Close to local shops, community facilities and parklands
- Extra-large bedrooms with fully accessible ensuites
- Private courtyards
- Smart home functionality
- Built to a high livability design standard for High Physical Support
- Wheelchair friendly kitchen benches and bathrooms
- Assisted bathing and hydrotherapy facilities
- Ceiling hoist tracks
Benefits of the Fund
- Rather than invest in term deposits, bonds, residential property or shares, investors have the opportunity to access a higher yield, supported by the security of underlying real estate investments.
- Pooling funds from a number of investors allows the Fund to access a broader range of high yield property investments and diversifies risk.
- Unlike other high-yielding property investments, such as industrial property, the Fund is not dependent on the commercial activities of tenants. Instead, the Fund accesses a rental income derived from long-term government funding.
- A professional management team with a range of complementary skills allows us to engage in specialist investment, development, construction and property management activities that are both economically, physically and financially complex. Investors benefit from the combined expertise of such an experienced team.
What if the property market falls?
- Income returns are NOT dependent on rising property values.
- Rental income streams for disability housing are much higher than those applicable to ordinary residential investment properties.
- Rental income is supported by government payments from the NDIA and Centrelink.
- Leases are typically long-term.
- Significant demand for disability housing (current supply and demand imbalance) and our focus on creating a quality product will support future demand for the housing assets we construct.
Q: What if the Federal Government (via the NDIA and Centrelink stops funding disability housing)?
A: The Government has pledged long-term bi-partisan support for the NDIA.
Q: How reliable are the returns?
A: The returns are supported by rental payments from the Federal Government, making them a lot more secure than if the Fund were investing in commercial property or just general residential real estate.
Q: Is it likely that the returns will vary over time?
A: It is intended that the returns will always be 1.5% per financial quarter.
Q: What happens if the NDIS tenants leave the property?
A: Leases are typically long term and our specialist property consultant will be responsible for sourcing new tenants to fill any vacancies on an ongoing basis. Properties are selected in areas where tenant demand is high and is likely to remain so over time.
For more information on the Rushton Social Impact Fund, phone 1300 791 882, or email us at: email@example.com
Note: Wholesale investors, as defined by section 761G of the Corporations Act (Cth) 2001.