All Topics / General Property / DIY Small Shops Property Trust

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  • Profile photo of DerynakaDerynaka
    Member
    @derynaka
    Join Date: 2003
    Post Count: 9

    Hello All,

    I have had this idea for many years now and feel I am in a position to start to implement my plan.
    PPOR paid off and equity to burn.

    I also currently own two older style corner shops, each divided into three shops. Six shops in total returning $52,000 pa, this is about 10% return on current valuations but the return is a lot greater on purchase prices. I could use one these properties to start the trust and show investors what can be acheived.

    My background is as a tradesman running my own business, realestate sales and more recently managing an employers association.

    Both shops have been renovated, new tenants found and rental returns increased. This would be the plan for future purchases. All this I can do with my eyes shut.

    Where i need help is in setting up a property trust that would invest in small shops. I would like to make my living buying the properties, managing the investors, properties,tenants and repairs.

    Has anyone any experience in setting up a property trust structure, were can I get more info, help and advice?

    What return would an investor expect when investing in the above trust and how is it calulated eg – rent plus capital gain equalls 10% return to the investor.

    Also what percentage would the manager of the trust expect to recieve.

    I could purchase another property myself but feel the above plan would have me doing more of what I love doing quicker, buying property.

    I look forward to your replies,
    Regards DC

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    I don’t know if you can set up a property trust like that without getting ASIC approval and a prospectus. Maybe you should check with ASIC just in case. This is like raising money from the public.

    If you just want to set up a trust with friends etc then it should be ok, and a good accountant will be able to help you with structure. It sounds like you are in a very good financial position, good luck.

    Terryw
    Discover Home Loans
    North Sydney
    [email protected]

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of hilaryhilary
    Member
    @hilary
    Join Date: 2002
    Post Count: 146

    Have thought of this myself – get a solicitor (won’t be cheap -$300 per hour – that’s all it should take) – there are lots of things to consider. You will need to have asic approval and a prospectus, but look at those as safety nets for yourself and your clients. You don’t need to go as high as 10% for clients – remember they can only get 4-5% at banks, but if you know you can make that much, after your fee, which you can set, then why not? After the deal is finalised, you will find you have repeat clients, who will be hanging out for your next venture.
    Good luck.

Viewing 3 posts - 1 through 3 (of 3 total)

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