Welcome to the Bell Direct mFund Asset Class series

Not all property investments are the same. Let's talk about Commercial Property.

You don't need to be rich to invest in commercial property

You don't need to be rich to invest in commercial property

This month, the Bell Direct mFund Asset Class series is looking at Commercial Property.

If you think you can't afford to invest in big office towers, shopping malls or business technology parks. Think again.

You can buy and sell small parcels of real estate, like shares, with little upfront capital, by investing in Real Estate Investment Trusts or REITs (previously known as Listed Property Trusts).

  • REITs own and manage commercial real estate which produce income (from rent collected from their tenants).
  • They’re listed on security exchanges and can be traded like shares.
  • They give access to assets usually out of reach for individual investors (i.e. large-scale commercial properties).
  • Heard of Scentre Group, Stockland, Dexus or GPT? They're REITs. 

It works like this: when you invest in REITs, you own a slice of a commercial property portfolio. You receive the regular dividends and potential capital growth it delivers as well as the benefits of liquidity.

Find out more below.

What are the benefits?

Commercial property investing is all about income.

The focus of commercial property is on delivering an attractive yield first (from rent collected), with capital growth second.

When you invest in commercial property, you can receive a regular, hassle-free income (from rent) without lifting a finger or making a huge capital outlay. 

You also benefit from the sector's defensive characteristics:

  • Rent is predictable. Businesses must pay rent regardless of whether their cash flows are strong or weak. 
  • Long contracted lease terms provide reliable income (usually contracted over 3 to 5 years and it's not uncommon for 10, 12 or even 15 year leases).
  • Regular rental increases offer protection against inflation. Most commercial leases have contracted rent reviews directly linked to CPI, fixed rates or market-based reviews.

Find out more on APN AREIT Fund

Find out more on APN Asian REIT Fund

The APN AREIT Fund

The APN AREIT Fund

Are you looking for consistent and relatively high income every month? The APN AREIT Fund is income-focused and gives you exposure to more than 3,000 commercial properties across Australia. The Fund:

  • Gives you access to assets like Westfield Bondi & Pitt St in Sydney and Chadstone in Melbourne and Governor Phillip & Macquarie Tower in Sydney.
  • Aims to generate sustainable, regular and relatively high income returns.
  • Provides a monthly income which is tax advantaged.
  • Aims to provide an income yield 10% higher than the average yield of the ASX200 AREIT dividend yield.
  • Is 100% liquid - you can apply and withdraw daily.
  • Is accessible via the mFund service (mFund code: APF01).

The APN Asian REIT Fund

The APN Asian REIT Fund

The APN Asian REIT Fund is also income-focused and pays monthly distributions. The Fund provides you with exposure to more than 6,000 commercial properties across the developed cities of Asia (primarily Japan, Hong Kong and Singapore). The Fund:

  • Gives you access to assets like the Vivo City in Singapore and the Harbour City in Hong Kong.
  • Aims to provide a stable, predictable and relatively high income, every month.
  • Aims to provide an income yield 10% higher than the average yield of the Bloomberg Asian REIT index.
  • Is 100% liquid - you can apply and withdraw daily.
  • Is accessible via the mFund service (mFund code: APF02).

Is Commercial Property right for you?

Is Commercial Property right for you?

Commercial property may suit investors:

  • Seeking consistent and relatively high levels of income.
  • Managing their own retirement (SMSFs).
  • Wanting access to a diversified portfolio of quality Australian and Asian REITs.
  • Looking to invest for the medium to long term.

APN - a commercial property specialist

APN - a commercial property specialist
  • They've been focusing exclusively on property for more than 20 years. 
  • They have an active investment style.
  • Their philosophy is “property for income”.
  • They co-invest with investors.

With APN, you're outsourcing your investment decisions to a team of commercial property experts.

How do you invest?

The APN AREIT Fund and APN Asian REIT Fund are available on our mFund platform. Simply place an order online through the order pad:

1. Login to your account and go to the order pad.

  • The mFund code for the APN AREIT Fund is APF01.
  • The mFund code for the APN Asian REIT Fund is APF02.

2. Read the fund profile and the Product Discloure Statement.

3. When you’re ready to invest, choose the 'Managed Funds' option on the Order Pad and place your order online.

4. Your new mFund units are transferred to your CHESS holdings and you’ll see them in your portfolio.

Find out more & read the fineprint

Returns:

  • As at 31 December 2018. Current running yield is calculated daily by dividing the annualised distribution rate by the latest entry unit price. Distributions may include a capital gains component. Distributions are not guaranteed and past performance is not an indicator of future returns.
  • Returns after all fees and expenses. Assumes distributions are reinvested. Investors' tax rates are not taken into account when calculating returns. Past performance is not an indicator of future performance.
  • Fund inception 19 January 2009.
  • AREIT index is the S&P/ASX 300 Property Trust Accumulation Index. 

You can find out more information on the APN AREIT Fund here.

This has been prepared for general information purposes only and without taking your objectives, financial situation or needs into account. You should consider these matters and read the product disclosure statement (PDS) for each of the funds described in its entirety before you make an investment decision. The PDS contains important information about risks, costs and fees associated with an investment in the relevant fund. For a copy of the PDS and more details about a fund and its performance click here.

Find out more about APN Property Group here.

Bell Direct charges a marketing fee for the promotion of the APN AREIT Fund.

Returns:

  • As at 31 December 2018. Current running yield is calculated daily by dividing the annualised distribution rate by the latest entry unit price. Distributions may include a capital gains component. Distributions are not guaranteed and past performance is not an indicator of future returns.
  • Returns shown are net of fees and expenses and are annualised for periods greater than one year. Assumes distributions are reinvested. Investors’ tax rates are not taken into account when calculating returns. Past performance is not an indicator of future performance.
  • Returns calculated since 19 July 2011 (when the Fund commenced). 
  • Asian REIT index is the Bloomberg Asia REIT Index.

You can find out more information on the APN Asian REIT Fund here.

This has been prepared for general information purposes only and without taking your objectives, financial situation or needs into account. You should consider these matters and read the product disclosure statement (PDS) for each of the funds described in its entirety before you make an investment decision. The PDS contains important information about risks, costs and fees associated with an investment in the relevant fund. For a copy of the PDS and more details about a fund and its performance click here.

Find out more about APN Property Group here.

Bell Direct charges a marketing fee for the promotion of the APN Asian REIT Fund.

Images have been sourced as below:

  • Clarke Quay: CapitalLand
  • Emporium Melbourne: Vicinity Centres
  • Laguna Plaza: Fortune REIT
  • Chatswood Chase: Vicinity Centres
  • Westfield Sydney: Scentre Group
  • Westfield Bondi Junction: Scentre Group