Investment Strategy - November 2013

8/13/2019 Investment Strategy - November 2013

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If you do what youve always done, youll get what youve always gotten. Tony Robbins September 2013


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Investment Strategy

This investment strategy is to assist individual investors not only increase their nest egg for

retirement, but importantly also their financial future.This strategy is ideally suited but not limited to investors with Industry Superannuation, plus

for private investors outside of their superannuation who are looking to invest.

Investors who want to improvetheir current financial position.

The strategy is based on two Investment types:

1. Superannuation- Investing via your Super by way of, Rolling over your currentIndustry Superannuation Fund/s into newly created Self-Managed Superannuation

Fund (SMSF), and investing into the unit trust.

2. Personal- Investing personal monies (funds) directly into the unit trust.The increased returns are gained by investing your Superannuation or private monies

into a leveraged Unit Trust property portfolio, where capital growth is gained on the

full asset value, and not just your invested amount.

The below example compares an Industry Superannuation Fund to a SMSF, but with the

SMSF having leverage on the asset.

The example has both of the funds earning the same annual growth of 5%.

As you will see below, the SMSFwith leverage will increase at a greater rate than the

industry fund, as the SMSF investment is earning capital growth on the total amount

investment (amount invested and borrowed) where as the industry fund is earning growth

on just the amount in the fund. Over a period of time this will have a significant difference in

the end value.

The below example shows the SMSF returning over 160%in 10 years and the industry fund

over the same time and same growth rate earning 60%


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SMSF Industry Fund Investment $100,000 Developers Discount $20,000 Bank funding $110,000 Total for investment $230,000 via

unit trust

5% annual growth

Investment $100,000 Developers contribution $00 Bank funding $00 Total for investment $100,000 5% annual growth

0.00%

20.00%

40.00%

60.00%

80.00%

100.00%

120.00%

140.00%

160.00%

180.00%

1 2 3 4 5 6 7 8 9 10

SMSF

Industry


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What is a Unit Trust?

A unit trust is a trust in which the trust property is divided into a number of defined shares

called units. The beneficiaries subscribe for the units in much the same way as shareholders

in a company subscribe for shares.

In an ordinary unit trust a beneficiary is entitled to the income and capital of the trust in

proportion to the number of units held. A unit in a unit trust is really just a means of

describing the share in the trust fund to which the unit holder is entitled.

How is a unit trust established?

Most unit trusts are established by subscription; that is, the initial unit holders (the

subscribers) subscribe for units in the unit trust, paying a set amount for each unit to the

trustee and, in return, the trustee issues those subscribers with the requisite number of

units, much like shareholders applying for shares in a company.

What are the benefits of a unit trust?

The main advantage of the unit trust over other types of trusts is that the parties involved

are issued with units which (like shares):

Define that partys interest in the assets and income of the trust; Can be easily transferred; and

Can be re-acquired by the trustee. Other benefits of a unit trust include the following:

Less regulation than a company; Taxation advantages over a company (in some cases);

The trust deed can be tailored to the needs of principals and beneficiaries; No legal problems with redeeming units from the unit holder; and

Easier to wind up than a company.


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Benefits of Investing in a Unit Trust via Your SMSF or Personally Control over your own Superannuation by investing into your Self-Managed Super Funds and

deciding to invest in the unit trust, rather than stay in your industry fund.

The Investor can exit at any-time after the completion of the development as per the unittrust rules below.

No personal capital required to invest if investing via your Superannuation. The capital israised from your current Industry Superannuation.

Increased equity is first achieved from developersdiscount to Investors for multipleproperties that will be purchased in the unit trust, this means growth from Day 1

Significantly better forecast returns and growth compared to industry funds, again asgrowth is on the total investment including borrowings and not just funds in your SMSF.

Low risk investment into the property market by way of low loan to vale rations ofproperties, normally below 60% LVR.

Forecast capital growth in the property values, by wayproperly selected property areaswith Werribee in the Wyndham City Shire. (Third fastest growing shire in Australia)

Substantial tax write-offs achieved from BMT tax depreciation schedules for all properties. Positively geared properties that will reduce debt, by way of the income being greater than

expenses.

Investing directly with the developer (Mission Equity Properties MEP) and developerspersonal equity. This shows great support by the developer in the project and the unit trust

for the future.

Administered and returned by CPA qualified accounting firm, currently Imax Business group. Investing your Superannuation in a property portfolio (bricks and mortar) that you can sight. Potential future developments available to invest in, by way of duplicating the same

investment strategy with the developer MEP.

Ability to access and utilise the increased equity in the properties held by the trust, for thepurpose of further Investment opportunities.


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Forecast Financial Benefits for the Unit Trust

Positive yield used to reduce overall debt, by way of income (rent) being greater thanexpenses (interest and Tax depreciation)

Increased asset growth from group leverage.

Estimated annual tax depreciation of $130,000 for group over all the properties owned bythe unit trust

Estimated annual gross rental return of $226,200, based on the 15 apartments held by theunit trust

Further debt reduction from monthly SMSF contributions, which means investors cancontribute additional fund into unit trust if they so choose, and these funds will be used for

debt reduction

Debt reduction achieved from Unit Trust off-set bank account, meaning all gross rentalincome will be deposited into offset account from where interest and expenses will be

debited. Meaning 100% of excess funds will be applied to debt reduction.


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Rules for the Unit Trust

Rules Specific to our Unit Trust that will be set out in the Trust Deed

1. Investment period in the Unit Trust is flexible. The minimum investment period is frominception to completion of the development. (approx. 15 months) Exiting at any stage

during the first three year, the returns will be as per the table below. Should you wish to

exit after the three years, the first option is to offer your unit holdings to other Unit Trust

members. Thereafter should your unit holdings not be sold to existing members, the unit

holdings shall be made available to the open market. It will be the exiting unit holders

responsibility to sell their holdings.

2. No Unit Trust investor is to have a controlling share of the Unit Trust.3. An annual meeting will be conducted for all investors of the Unit Trust, at which you will

receive your statement from the Unit Trust relating to distribution received by your

investment.

4. All initial Unit Trust funds will be used as development funding and secured by thedevelopment. The Unit Trust funds will be held in a Solicitors trust account until the

development proceeds. The Unit Trust funds cannot be released or utilised by the

developer until the developer achieves finance approval.

5. The Unit Trust is obligated to undertake an annual tax return which will be prepared by thegroup accounting firm, at this stage is IMAX group.

6.

All SMSFs are obligated to undertake a financial and audit return which can be preparedby an accountant firm and audited by registered SMSF auditor.

7. A trustee to represent and be responsible for the trust will be appointed. Current nomineeis Mark Pemmelaar.

8. Funds will be jointly controlled by the trustee and an accounting firm representative.9. None of the Unit Trust holders will have any right to personally use any of the apartments

purchased or held by the Unit Trust.

10. Positive yields of the Unit Trust will be used exclusively for the debt reduction strategy tomaximise returns for all Unit Trust investors.

Exiting returns for 1-3 years return Example $100,000.00

On completion of development - Year 1 20% $120,000.00

End of year 2 25% $125,000.00

End of year 3 30% $130,000.00


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11. The apartments will be revalued yearly by a Licenced estate agent, than valued every twoyears by a registered property valuer.

12.The Unit Trust will accept additional monthly contributions from members SMSFs.Theunits purchased in the Unit Trust by the SMSF will be at the rate established by the

accountant utilising the current annual valuation provided by the registered propertyvaluer.

13. The Unit Trust will operate with a bank off-set account and loan facilities under jointauthority of the accountant and trustee.

14. The Unit Trust will consider future property development opportunities proposed by MEP.Forecast milestone for Investors

1. Expression of Interest signed by interested investors and returned to MEP, this shows yourintent to commitment to us, and to progress through to being an investor in the unit trust.

2. Developer achieves finance approval for the development (End of January 2014)3. The Unit Trust established by IMAX accounting firm.4. Individual SMSFs (if required) established by an accounting firm for investors.5. Funds rolled over from Industry Superannuation Funds to your SMSF by the accountant6. The SMSF funds transferred to Unit Trust account and held in trust by a Solicitor7. The Contract of Sale from MEP to Unit Trust implemented for the 15 apartments8. Finance approved for the purchase of the 15 Werribee apartments achieved9. The Unit Trust funds released to developer early 2014.10. Construction of apartments commences March/April 2014.11. Completion of total development by MEP achieved in April 2015.12. Settlement of the 15 apartments after construction completion.13. Werribee apartments available for tenancy and issued to a property manager for

occupancy.


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Location of properties to be purchased

By the Unit Trust in WerribeeWithin the Wyndham Shire,

The Third Fastest Growing Shire in Australia


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235-237 Princes Highway Werribee& East Werribee future employment precinct

235-237 Princes

Highway


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Princes Apartments

Werribee44 Architectural designed apartments


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Ground Floor


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First Floor


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Second Floor


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Benefits of Development

Location235-237 Princes Highway, Werribee is opposite Wyndhams Technology Precinct where major

entities such as Melbourne University Veterinary clinic & hospital, the Mercy Hospital, Victoria

University Werribee Campus and Victoria University Industrial Skills Training centre.

Exceptional Growth Area

Wyndham has experienced the largest and fastest growth in all Victorian local government areas

and is the third fastest growing in Australia. Its estimated residential population set to exceed

245,000 people by 2021.

Western Suburb Project Gets $72m Injection for

Infrastructure

Western suburb project gets $72m injection for infrastructure.

The future of a new suburb in Melbourne's west has been assured after a major cash injection from

the State Government to improve infrastructure.

In November, the Coalition announced plans for a suburb on vacant land between Werribee and

Point Cook. The suburb is expected to house 20,000 people and create 50,000 jobs


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The Apartment Complex Princes Apartments

The complex at 235 237 Princes Highway is a unique architecturally designed blend of one, two

and three bedroom apartments. The apartments include balconies and/or private courtyard, car

spaces and landscaping.

Full Turn Key Package

Price includes:

Caesar stone bench tops

Quality appliances

Quality tiles and floor covering

Window coverings

Tiled balconies

Reverse cycle heating and cooling

Broadband & Foxtel

Fully maintained gardens and common area

Security front entry gates

Storage areas for each apartment

Body corporate management

Full BMT tax depreciation schedules


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What smart investors need to know?

Location (close to employment and services)

Potential for population and capital growth

Employment opportunities (rent ability)

Infrastructure spending (government)

Quality product and fit out

Tax depreciation (maximising tax deduction)

Turn Key Packages (ready to rent)

Uniqueness of development -Broadband / Foxtel

Copy of the Contract of Sale

Body corporate fees

Proposed completion date

Council rates


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Article from February 2013 edition:

New capitalset for growth corridor

A NEWsuburb with 50,000 jobs across a number of industries is being created to become the 'capital' of a

major growth corridor.

The Victorian suburb on the 770-hectare East Werribee Employment Precinct will also have crucial

transport and infrastructure services, according to premier Ted Baillieu and planning minister Matthew

Guy, who said it would hold 7,000 properties.

"The East Werribee Employment Precinct will be the largest integrated business and residential

development of government-owned land in Victoria since Docklands," Mr Baillieu said.

The new development, outlined in the draft Precinct Structure Plan for the site, demonstrates confidence in

Melbournes west and lays the foundation for a residential heart of thewestern growth corridor, Mr Guy

added.

"East Werribee is in the heart of one of Australia's fastest growing urban areas and is a prime location for

increased residential and commercial activity," he said.

The suburb is 25km from Melbourne and 40km from Geelong's city centre. It is also close to Tullamarine

airport and Avalon airport.

The area will be a new capital for Melbournes west, according to Growth Areas Authority chief executive

officer Peter Seamer.

"The vision we have for the future is one where people living in our newest suburbs have access to localjobs, town centres and the services they need, without spending two hours in the car or train each day

travelling to where they need to be," Mr Seamer said.

"East Werribee will deliver this vision and, together with the Werribee City Centre, will create a vibrant

capital of Melbourne's west."

http://spionline.com.au/home/11235-new-capital-set-for-growth-corridor


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Ease of Setting up Your SMSF and Group Unit Trust

One stop professional suite for setting up of SMSF and streamline process for rolling overIndustry Superannuation.

Unit Trust administered and returned by CPA qualified accounting firm.

Your SMSF tax prepared and then audited by ASIC registered SMSF auditor.

Financial planning (if required) by a professional financial planner.

Clearly defined investment rules in the Unit Trust to protect and maximise potential for allinvestors.

Costs of Setting up and Running Your SMSF

Initial setup of individual SMSF including ABN & TFN - $1,290.00 incl. GST (paid by SMSF)Corporate trustees $2,190.

Yearly compliance of SMSF including tax return and audit from $1,500.00 incl. GST(paidby SMSF, which would be covered by employer 9.25%).

Cost of Setting up and Running the Unit Trust

Yearly compliance of Unit Trust including tax return app $150.00 per hour plus GST(paid outof Unit Trust rental income).

Initial setup of Unit Trust including ABN & TFN - $5,500.00 incl. GST (paid out of Investmentcapital divided by 20 investors = $275.00 cost for each member).

Note: existing Unit Trust held by the Pemmelaar & Burgess SMSFs may be used.


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Contact Details

Mission Equity Properties Pty Ltd

Property Developers

Mark Pemmelaar | General Manager

Mobile: 0481 460 210

Email: [email protected]

Postal: PO Box 419 Niddrie Vic 3042

Scott Burgess | Business Development Manager

Mobile: 0407 096 280

Email: [email protected]: PO Box 419 Niddrie Vic 3042

MatthewCaruanaBranch Principal & Wealth Manager, CR: #431896, AR: #438081

Yellow Brick Road NiddrieKeilor Road, Niddrie, VIC 3042

T 03 9379 1100M 0411 079 057F

[email protected]

Arthur Ioannou - Director

E:[email protected] P: (03) 9481 6244 I M: 0400 262 671

652 Smith Street CLIFTON HILL VIC 3068 Australia I Postal | PO Box 265 CLIFTON HILL VIC 3068 Australia

Contact | P: (03) 9481 6244 | F: (03) 9481 6255 | M: 0400 262 671 | W:www.imaxbg.com.au

Disclaimer: Note that the projections listed above simply illustrate the outcome calculated from the input values

and the assumptions contained in the model. Hence the figures can be varied as required and are in no way intended to be a

guarantee of future performance. Although the information is provided in good faith, it is also given on the basis that no

person using the information, in whole or in part, shall have any claim against any person providing the information.
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]://www.ybr.com.au/http://www.ybr.com.au/mailto:[email protected]://www.imaxbg.com.au/http://www.imaxbg.com.au/mailto:[email protected]://www.ybr.com.au/mailto:[email protected]:[email protected]:[email protected]

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Investment Strategy - November 2013