|
Trust |
The Trust is an
unlisted unit trust registered with ASIC as a
managed investment scheme under the Corporations
Act. |
|
Offer |
An invitation to apply
for up to 400 million Units in the Trust. |
|
Responsible Entity |
Fortuna Funds
Management Limited |
|
Investment
Committee |
Composed of executive
directors of the board of the Responsible Entity and
other persons appointed by the board from time to
time. |
|
National Real
Estate Advisory Panel |
The Investment
Committee may obtain the services of members of the
National Real Estate Advisory Panel (Advisory Panel)
to assist it from time to time in implementing the
Trust's investment strategy.
Members of the Advisory Panel may include estate
agents, residential property valuers and property
managers. |
|
Investment
objective |
To provide Unitholders
with attractive returns over the long-term utilising
the residential property asset class. |
|
Investment strategy |
The investment
strategy of the Trust is to utilise Australia's
residential property markets by providing
Unitholders access to these markets. The Responsible
Entity seeks to reduce the Trust's exposure to risk,
whilst maximising its capital appreciation, by
building a diverse portfolio of established
residential properties across a range of geographic
and economic categories. To this end the Trust is
growth-focused, aiming for long-term gains rather
than short-term income yields. The Trust will not
hold any property in Western Australia or Queensland
until the Trust satisfies certain requirements of
the stamp duty legislation in those states. These
requirements are set out in more detail in Section 8
of the PDS |
|
Trust assets |
The Trust seeks to
have approximately 90% of its assets invested in
established residential property which are selected
for capital growth potential. The remaining funds of
the Trust will be held in cash, bank bills and money
market instruments. During the first 8-12 months,
the Trust may be fully invested in cash, bank bills
and money market instruments. |
|
Investment
timeframe |
Long term – at least
five to ten years. |
|
Minimum application
amount |
$10,000 |
|
Additional
investments |
Multiples of $1,000 or
$100 per month through the Monthly Investment Plan.
Section 9 |
|
Unit pricing |
The Unit price is
generally calculated each Business Day. |
|
Issue Price per
unit |
$1.00 per Unit for the
first issue of Units, and thereafter a price
determined based on the Net Asset Value, plus the
Buy Spread. |
|
Cooling Off Period |
There is a cooling off
period for Unitholders. |
|
Redemption Period |
While the Trust is
liquid, Redemption Requests will be processed within
90 Business Days from the end of the month in which
the Responsible Entity receives a completed
Redemption Request. While the Trust may be liquid
for the purposes of the Corporations Act by virtue
of the relatively long Redemption Period of 90
Business Days, an investment in the Trust should be
considered an illiquid investment which will be held
for the long term. Under the Constitution, the
Responsible Entity may suspend redemptions in
certain circumstances. |
|
Minimum Redemption
amount |
$1,000. If a
Unitholder holds less than 5,000 Units after
processing a Redemption Request, the Responsible
Entity may redeem all the Unitholder's remaining
Units. |
|
Redemption Price |
An amount determined
based on the Net Asset Value, less the Sell Spread. |
|
Redemption payment
options |
All payments will be
made by direct credit to an Australian Financial
Institution only; no cheques will be issued. |
|
Fees and expenses
|
Contribution
fee: 5.5% (inclusive of
GST) of the application amount. Fortuna may pay up
to 4.4% (inclusive of GST, net of any reduced input
tax credits) to financial advisors.
Management costs 1.45% p.a. (inclusive of GST, net
of reduced input tax credits) of the Gross Asset
Value of the Trust, payable quarterly in arrears.
Fortuna may pay part of this fee to financial
advisors. All expenses incurred in operating the
Trust will be paid out of the Trust assets. These
include administration and audit costs, property
management fees, sales supervision fees and
Custodian fees.
Performance fee: A performance fee is payable
to Fortuna if any previous underperformance of the
Trust, as reflected in the Unit Value, has been
recovered and if the total return of the Trust
exceeds 10% p.a. during a Performance Fee Period.
The Performance Fee is 18.45% (inclusive of GST, net
of reduced input tax credits) of the total return of
the Trust above 10% during a Performance Fee Period,
subject to any losses during previous Performance
Fee Periods being recovered. A Performance Fee
Period is currently a Financial Year, but can be
longer if the Responsible Entity determines.
Disposal Fee: The Responsible Entity is
entitled to a fee of 1.1% (inclusive of GST) of the
value of each residential property sold from the
Trust. This fee will be paid out of the assets of
the Trust at the time of sale.
The transaction costs of buying and selling assets
of the Trust in connection with applications and
redemptions will be reflected in the Issue Price
(Buy Spread is currently estimated to be 6.30%) and
the Redemption Price (Sell Spread is currently
estimated to be 2.33%). |
|
Risks |
There are risks
associated with investing in the Trust. Some of
these are described in the PDS. |
|
Tax |
Under current tax law,
any income and capital gains distributed to you by
the Trust are assessable to you and taxable in the
year to which they relate. The Responsible Entity
recommends that you obtain independent tax advice
relevant to your personal circumstances as to the
taxation consequences of an investment in the Trust. |
|
Income
distributions |
The Responsible Entity
does not expect there to be significant income to
distribute since the aim of the Trust is to provide
capital growth. Unless a Unitholder instructs
otherwise, any distributions will be reinvested in
the Trust. If a Unitholder does not wish to have
their distributions reinvested, then the
distributions will be paid by electronic funds
transfer to an Australian Financial Institution's
account nominated by the Unitholder. If a Unitholder
receives its distribution in the form of Units, the
Unitholder may have to pay taxes on the distribution
from its own sources.
No contribution fees (or commissions on these fees)
apply to Units issued as a result of a reinvestment
of a distribution. The Responsible Entity may, in
its discretion, elect to distribute cash and not
issue Units.
Any income not reinvested in the Trust will usually
be paid by the 20th Business Day after the end of
the Distribution Period. |
|
Complaints |
The Responsible Entity
has established procedures for dealing with
complaints and is a member of an external complaints
scheme. |
|
Reporting |
Unitholders will
receive information as required by the law.
Information is also available on the website at
www.fortunafunds.com.au. |
