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Discussion in 'Real Estate' started by DaveA, 18th Dec, 2007.

  1. DaveA

    DaveA Well-Known Member

    19th Feb, 2007
    Sydney, NSW
    Does anyone know how this works?? From my understanding its like a COMPANY buys the asset, and then sells the right of the asset to a trust, where the trust has the exclusive use of the property (ie to rent it out). The custodian can then only cancel this right upon payment of a fee (usually market value). So basically it could be good to have a UT sell it back and a DT buy it out when its cash flow positive. There seems to be no loss of CGT though as its effectively held by the trust.

    Basically wondering if anyone knows any more detail or knows somewhere which has some reading i can do about it.

    And yes, i love pushing the boundarys of what is the most effective.

  2. Nigel Ward

    Nigel Ward Team InvestEd

    10th Jun, 2005
    Despite our single responsible entity regime it is common practice for responsible entities to outsource the task of holding the legal title to managed fund assets to professional custodians - e.g. permanent trustees, state street, sandhurst etc

    The Custodian holds the property on a bare trust and subject to the terms of a custody agreement.

    What you're proposing though...I don't understand.