How does The Fund manage it?
There are several key features that make The Primary
Infrastructure Fund a standout:
|
• |
High
performance – long term trends underpin the Fund’s
outlook for high income distributions |
|
• |
Tenant quality – agribusiness ASX listed tenants –
e.g. McGuigan Simeon Wines Ltd, Select Harvests Ltd
and one of the Australia’s largest integrated citrus
growing, packing and marketing enterprises, Yandilla
Park Pty Ltd (Chiquita Brands South Pacific Ltd) |
|
• |
Certainty – long-term, inflation protected leases to
proven operators provide a lower risk way of tapping
into Australian agribusiness’ exciting investment
potential |
|
• |
Proven manager – Orchard has 15 years
experience, more than $1.5 billion funds under
management, and is a leading manager of
non-traditional property assets. |
Performance
|
December 2005 |
1 Year
% |
Since
inception (1)
% p.a. |
|
Distribution yield |
9.38
|
9.35
|
|
Total return |
9.38
|
9.35
|
|
Tax effective (2) |
100
|
100
|
(1) Distribution and
yield figures have been annualised as the Fund
commenced in September 2004.
(2) Based on the actual number for the year ended 30
June 2005. Returns are net of all management fees
and Fund expenses. The unit price for the Fund was
fixed until 31 December 2005. |
Who should invest in the Fund?
Investors in the Fund include many different people – all
seeking high, regular, tax effective income returns and
moderate to strong growth of their capital investment. Do
any of these sound familiar?
|
• |
Tax-averse – Want more income, but don’t want to pay
more income tax? |
|
• |
Debt
reduction – Looking to reduce debt and meet
additional expenses? |
|
• |
Self
Managed Superannuation Fund – Need strong,
long-term, reliable performance to fuel your own
super fund? |
|
• |
Retirement – Funding your own retirement and want
more money to spend? |
People with these
needs, and many others, may find The Primary
Infrastructure Fund is a match for their
requirements.
Orchard manages The Primary
Infrastructure Fund for strong income and tax
effectiveness over the longer term.
The Fund Strategy
The strategy for The Primary Infrastructure Fund is
based on:
|
Tactics |
Primary infrastructure assets |
Diversification |
Non-traditional versus traditional |
|
Description |
The Fund strives to maintain a portfolio of
quality property and infrastructure assets used in
the primary production industry.
Primary infrastructure is a long-term asset class
which aims to deliver tax effective income. |
The Fund seeks to maximise its
number, type and location of properties and tenants.
This spreads risks and helps in maximising
reliability of performance. |
Primary infrastructure and other
non-traditional property sectors perform differently
to the traditional property sectors of office,
retail and industrial.
This means that a non-traditional sector investment
can deliver rising investment performance when
traditional property sector returns are falling. |
Property assets by location
|
The Primary Infrastructure Fund is a
diversified rural ‘landlord’ – leasing land and key
production assets to ‘bluechip’ agribusiness
operators on a long-term basis. |
 |
Property
assets by sector
|
Intensive due diligence and asset management |
Debt management |
Smart
lease structuring |
Active
management |
|
The Fund
strives to ensure that new assets contribute well to
the Fund’s overall performance. There is a strategic
plan developed for the life of each property. |
The Fund seeks to negotiate
extremely competitive lending rates and apply
prudent financial risk management controls to ensure
effective financial performance from its debt
coverage. |
This includes long
leases that help provide consistency of income over
time, and generally annual rental increases
contractually built-in, to protect against
inflation. |
The Fund targets
outperformance of the InTech Direct Property Index.
To achieve this, the Fund may invest in:
– directly held real property
– indirect property held through other unlisted funds, or
– listed property trusts.
In all cases, the investments will be primary
production or horticulture related. |
|
Wine and table grapes |
|
Infrastructure assets |
|
|
 |
The Fund features
2,000+ hectares of high quality wine and table grape
vineyards in South Australia and Victoria. The
Fund’s inland, warmer climate plantings of
export quality wine varieties (Shiraz, Chardonnay)
are forecast to enjoy continued strong demand. The
newly introduced Crimson seedless table grape is
fast winning increased domestic market share. |
 |
The Primary
Infrastructure Fund holdings include a range of
fixed assets used in the growing and processing
phases by our key tenants. Examples include, packing
sheds, irrigation infrastructure, and water rights
attached to the Fund’s land assets and leased to
tenants. |
|
Citrus |
|
Almonds |
|
 |
Citrus holdings
currently represent approximately one-third of the
Fund’s assets, and include premium variety orange
and mandarin orchards in South Australia and
Victoria. Managed by experienced operators, variety
selection and harvest timing are used to target peak
domestic and international markets. |
 |
The Fund's almond
holdings are based in Victoria. Australian almond
crops are noted for both quality and production
yield, on an international comparison basis.
Worldwide almond consumption continues to grow year
on year, with consumption at over 500,000 tonnes
p.a. |
About Orchard
The Primary Infrastructure Fund reflects Orchard’s
distinctive approach to investment selection and management.
Orchard is one of the leading managers of unlisted
commercial property investments in Australia with over $1.5
billion funds under management as at 31 December 2005. In
addition, Orchard’s experienced agribusiness
division, Orchard Agribusiness Pty Ltd, manages over
$200 million in assets and projects for over 1,000 investors
in wine grapes, almonds, table grapes, mangoes, and citrus;
as well as other enterprises.
The company prides itself on its investment management
performance. It focuses on structuring commercial property
trusts, funds and other products that use office,
industrial, retail, healthcare, agricultural and other
special purpose built property assets throughout Australia.
The use of sophisticated risk management means that
Orchard has an approach quite different to that
typically adopted by other managers in the primary
infrastructure asset class.
Orchard aims to provide consistently higher returns,
with funds that perform well across the economic cycle, with
little volatility and minimal overall risk to the
investment.
Orchard Securities Pty Limited
ABN 16 091 909 376
Holder of Australian Financial Services Licence No. 241053
This material has been prepared without taking account of
your objectives, financial situations or needs. Before using
this material to make any investment decision, you should
consider whether it is appropriate to your own objectives,
financial situation and needs. In order for a personal
recommendation to be made, you should contact a qualified
and licensed financial adviser so full needs analysis can be
undertaken with full access to your personal information.
Facts and figures referred to in this document reflect the
position of The Primary Infrastructure Fund as at 31
December, 2005.
Orchard Property Limited AFSL 233191 is the issuer of
interests in The Primary Infrastructure Fund ARSN 110 813
851. A person should consider the Product Disclosure
Statement in deciding whether to acquire, or to continue to
hold, interests in the product.
Orchard Securities Pty Limited is a related
corporation of Orchard Property Limited.
Photographs on this page may not represent assets of the
Fund. |
