How To Develop Property In Your SMSF

“How To Develop Property In Your SMSF, With Lower Risk”

A crowd funded property development model that allows you to invest as little as $5,000 (or as much as $500,000).

Introducing...

An innovative way for property investors to enjoy the upside potential of property

development, while eliminating some of the most serious risks...and without getting your

boots dirty!

Meet Your Hosts

What You’ll Discover In The Next 45 Minutes

1. Why the traditional property development model is broken

2. The crowd-funded property-development model explained

3. The numbers behind a current project (targeting 46% profit over 24 mths)

4. Simulation: “What would happen if GFC2 hit tomorrow?”

5. How to find out more

Why Property Development?

PROS● Strong record of historical growth in Australia● A tangible “manufacturing” business● Adding value dramatically boosts profit potential● Faster “cash out” period than direct property

CONS● Complexity● “Manufacturing risk”● Bank has significant control● Significant capital required

Why The Traditional Property Development Model Is Broken

TotalDelivery Costs(TDC)

Available profit

75%

25%

Market Value = $100

$25

$25

$25

$25

TotalDelivery Costs(TDC)

Available profit

Market Value = $100

$25

$25

$25

$25

TotalDelivery Costs(TDC)

Available profit

Market Value = $100

Equity invested$25

$25

$25

$25

TotalDelivery Costs(TDC)

Available profit

Market Value = $100

Equity invested$25

$25

$25

$25

Equation: $25 Profit from$25 Invested =

100% Return

TotalDelivery Costs(TDC)

Available profit

Market Value = $100Equity invested by investors

$25

$25

$25

$25

Equation = $25 Profit from $75 Invested = 33% Return

Okay, but not WOW

How With-Debt and Zero-Debt Development Returns Compare

Equity Profit ROI

With-Debt Development

$25 $25 100%

Zero-Debt Development

$75 $25 33%

So… why “zero-debt”?Banks no longer monopolise lending

… eliminating the risk of the bank taking over the asset

AND

… increasing “sleep at night” factor

Market Volatility: How it Affects Traditional Property Development

Revenue liquidity dries up bank claims asset

Karthikeyan Thangaraj, R. & Chank, TK (2012) “The effects of the global financial crisis on the Australian building construction supply chain” Construction, Economics & Building, 12 (3), 16-30.

< 1.8 = below “imminent failure” threshold

Karthikeyan Thangaraj, R. & Chank, TK (2012) “The effects of the global financial crisis on the Australian building construction supply chain” Construction, Economics & Building, 12 (3), 16-30.

With debt, banks retain ultimate control of the asset

Our Model In A Nutshell

1. Find opportunity

2. Raise capital

3. Minimise costsi. cost of partsii. cost of assemblyiii. cost of selling

4. Sell the finished product

5. Distribute profits to the investors

3 Ways We Manage The Downsides of Property Development...

1. Eliminate debt and remove banks from the equation

2. Minimise conflict to reduce waste

3. Provide a simpler, more transparent way to invest

Traditional Property Development Is All Too Often Marred By Conflict

Simple and Transparent

1. Investments start at $5K

2. Invest inside or outside SMSF

3. Keep up-to-date online... or visit us on site

An Actual Project - Bryna Parade, Oxenford QLD

* All numbers based on project feasibility only - please contact us for a full Product Disclosure Statement

Key Facts About Bryna Parade,Oxenford, Gold Coast

“South east Queensland is my top pick of everywhere to buy in Australasia at the moment… I’d be hard pushed to find anywhere better to invest in the next 3-5 years for capital growth.”

- John McGrath, CEO of McGrath Estate Agents

● 58, 2- and 3-storey townhouses.

● Minimum investment $5,000 (avg. $50K, Max. $500K)

● Targeting 45.98% profit over 24 months

● Suitable for SMSF or non-SMSF investment

● Currently ~48 hours away from maximum capital allocation

● Participate in the upsides of property development with reduced risks and downsides

PLUS… Earn 8.65% On Your Invested FundsUntil The Project Commences!

Some conditions apply - please refer to information website for full details

What would happen if GFC2 hit?With debt? And without debt?

Num

ber o

f tra

nsac

tions

Transaction amount

Understanding Average House Price

$150,000 $10,000,000

Pre-GFC average house price in Australia

Num

ber o

f tra

nsac

tions

Transaction amount

Understanding Average House Price

$150,000 $10,000,000

Pre-GFC average house price in Australia

The average price actually went up after the GFC but the top end collapsed.

This means that the dwellings below the average went up very significantly on the back of the government stimulation.

Post GFC average house price in Australia

Assuming: ● Our current projected profits and IRR for Bryna Parade over 24 months ● 24 month delay (development takes twice as long as projected)

Worst-case scenario: what could happen to your investment in a zero-debt model?

Investment amount

24 months 36 mths 48 mths

Projected Profit

Projected IRR Projected Profit

Projected IRR Projected Profit

Projected IRR

$100,00045.98% 19.90% 45.98% 13.26%* 45.98% 9.95%*

$145,980 $145,980 $145,980

*These are approximations only - not all costs have been considered in this outcome - for example, the Funds Manager charges an annual fee which has not been included in the 36 month and 48 month example.

Worst-case scenario: what could happen to your investment in a leveraged model?

● Bank claims the asset

● No development and no returns for investors

The Tradeoff

Returns may not be the same as a leveraged property development model…

BUT

“Sleep at night” factor is higher…

AND

45.98% over 24 months is significantly better than ~2% on cash in the bank

Development Income Fund(Open for Expressions of Interest)

- no unit price growth- targeting 7.5% p.a. (paid monthly)- suitable for most entities including SMSFs- minimum investment $20,000- 24 month term

● Development cost (in millions) versus time (in months).

● This is a simplified, typical, single staged, small townhouse SPV development.

Typical Staged Development

Find Out More And Request an Invitation to Invest in Bryna Or express interest in our Development Income Fund.

Make a time: www.booknow.so/SMSFPropertyTeamemail: hello@smsf.me

Invest online: http://www.smsfproperty.net.au/invest-online/

Investor Comment - Brett Rix“SMSF Property Capital provides the opportunity to directly invest in property development - an activity that is beyond the reach of most investors who do not have the time or skills to project management their own construction sites.

SMSF Property Capital make you feel like a part owner in an actual business. They drag you through the mud on site,share with you the frustration of local government behaviour,and take you through the journey of design, construction andsales.

The potential returns are strong with a lot of downsideprotection.”

Find Out More And Request an Invitation to Invest in Bryna Or express interest in our Development Income Fund.

Make a time: www.booknow.so/SMSFPropertyTeamemail: hello@smsf.me

Invest online: http://www.smsfproperty.net.au/invest-online/

Q&A Timeor make a time: www.booknow.

so/SMSFPropertyTeam

Find Out More And Request an Invitation to Invest in Bryna Or express interest in our Development Income Fund.

Make a time: www.booknow.so/SMSFPropertyTeamemail: hello@smsf.me

Invest online: http://www.smsfproperty.net.au/invest-online/