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Introduction

Discussion in 'Introductions' started by MrMarket, 26th Feb, 2017.

  1. MrMarket

    MrMarket Member

    Joined:
    26th Feb, 2017
    Posts:
    9
    Location:
    Sydney, NSW
    Hi all

    I just wanted to introduce myself. I am 31, partnered with no kids (yet) and based in Sydney.

    I came across this forum as part of some research into investment structuring and tax effective investing.

    To say that I have learnt a lot from this forum in terms of personal wealth management is a massive understatement. The active contributor base is impressive and I have found the forum to be a tremendous resource.

    Some background about me:

    I currently work full time in investment management. In previous jobs, I've worked in retail banking (product development), corporate strategy, financial planning operations, research, portfolio management and platform product management.

    Currently, I invest in managed funds, residential property and commercial property syndicates. I have dabbled in options trading in the past, however the nature of my current role means that investing in derivatives and individual securities is a compliance nightmare.

    I am not biased towards 'active' or 'passive', in fact the place I work at blends passive ETFs, 'smart beta', active management and derivatives as part of portfolio construction.

    I am particularly interested in property investment, structuring and income tax minimisation.

    Regards,
    Mike
     
    Last edited: 26th Feb, 2017
  2. Simon Hampel

    Simon Hampel Co-founder Staff Member

    Joined:
    9th Jun, 2005
    Posts:
    4,778
    Location:
    Sydney, Australia
    Hey Mike - welcome to InvestChat!

    Would love to know more about your investments in commercial property syndicates - how does this work?
     
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  3. MrMarket

    MrMarket Member

    Joined:
    26th Feb, 2017
    Posts:
    9
    Location:
    Sydney, NSW
    Thanks Simon
    They are essentially open ended or closed end managed funds that pool investor funds together to buy commercial properties. They are generally illiquid, limited liquidity and most have a defined exit period.

    I only use/trust a small number of issuers - seems like some of these things have blown up around the GFC due to poor management, excessive gearing and liquidity profiles that don't match the underlying assets. I like the syndicates that target potential growth locations, with value add opportunities, have long leases to blue chip/government tenants, hedged interest rate in current market conditions and have low-moderate gearing.

    Here's a website that provides analysis on previous/current issues: PIR - Unlisted Funds. I must admit that I haven't looked into the remuneration model of that website, but nonetheless I find it to be mainly fact based.
     
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  4. Simon Hampel

    Simon Hampel Co-founder Staff Member

    Joined:
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    Location:
    Sydney, Australia
    Ahh - so basically unlisted property trusts?

    These were pretty huge pre-GFC but the whole sector took a huge beating when the finance crunch hit. I know a few people who were buying into them and did quite well.
     
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  5. MrMarket

    MrMarket Member

    Joined:
    26th Feb, 2017
    Posts:
    9
    Location:
    Sydney, NSW
    Yeah I believe they are the same thing.

    Absolutely, many of these didn't do very well because of reasons I mentioned above. AREITs also blew up, albeit they were borrowing to pay distributions! In saying that, AREITS were extremely attractive after they blew up and recapitalised, albeit they aren't looking so good again...
     
  6. Simon Hampel

    Simon Hampel Co-founder Staff Member

    Joined:
    9th Jun, 2005
    Posts:
    4,778
    Location:
    Sydney, Australia
    Yes, I was able to recover most of our SMSF (which dropped over 50% in value) by (amongst other things) investing in (internally) geared international property securities funds which had been hammered during the GFC but then eventually rebounded strongly.

    I was just starting to research AREITs (as you can see, I still think of them by their old name UPTs), when the GFC hit - so never invested in them and haven't had the capital available since.

    I recall back during the pre-GFC growth period, Peter Spann telling us at one of our meetups he spoke at that he was routinely investing his own money into most new REITs that came available for research purposes - he would just put the minimum amount into every trust which looked like a good opportunity and was doing very well and that gave him a good feel for how various investment types and locations were doing because he actually paid attention to the real returns that were being generated.

    I hate to think how that all went during the GFC - but as a general strategy it sounds interesting (assuming you have the capital available to pursue it!). Obviously you wouldn't want that to be your only investment class!