When a client invests in a project, they are allocated units in a Unit Trust, proportional to the amount of capital invested: $1,000 equals one Unit. At the same time, they receive shares in a controlling entity responsible for the purchase and development of the land: a Special Purpose Vehicle. The special purpose vehicle (also known as an SPV) is a registered proprietary limited company which is incorporated for the purpose of the property developments completion. The SPV functions as a legal entity which collectively represents all investors in a project. Investors also have voting rights in this Company, which for example can be exercised should the management agreement require major changes. The Joint Venture agreement to undertake a project is between Lion Property Group and the Proprietary Limited Company. The development site for the project is purchased by the Company which represents the investors, using investor capital. As the investors are shareholders, they are entitled to the assets of the Company to recoup their investment in the unlikely event of an insolvency or other failure. This means that investor capital is secured against the value of the development site itself. If the worst-case happens, investors can sell the site to get their capital back, or take another course of action, depending on what the shareholders vote to do. While the land is collectively owned by the investors, they don’t want to be doing the work of actually undertaking the development. Which is why the Company appoints Lion Property Group as the Development Manager via the management agreement. This agreement also outlines the plan and overall intended process for the development, including the type and number of properties to be constructed. As the Development Manager, Lion Property Group is responsible for completing the development on behalf of the Company and the investors. This involves, but is not limited to:
This investment structure is utilised because it ensures that investors are protected, but grants us the ability to undertake the development in a timely and efficient manner in line with investor expectations.
Each investment opportunity offers a different return to investors based on the feasibility study we have conducted for that project. Some projects feature contractually-fixed minimum returns, and some include delay compensation, providing investors with additional returns if the project runs over the listed investment term. Not all opportunities include these features, so carefully review each opportunity’s Information Memorandum and Investment Agreement to understand what is offered.
We accept any investment over $250,000. Smaller investments may be accepted at Management’s discretion based on availability within a project. The legal structure we use to undertake a project has a limit on the number of parties that may participate in the project, and so we may only accept a small number of investors who meet the capital requirements.
No. You are investing capital to fund a property development project and you receive returns upon completion. You do not receive ownership of any of the properties constructed in the project unless you choose to buy a property as a separate transaction. See ‘How are these investments structured?’ for more information.
Yes. Each project is an independent entity and is unrelated to any other projects currently being managed by Lion Property Group. Monies from one project are not used in other projects. You may invest in multiple investment opportunities depending on the amount of capital you have to invest and our current availability.
Yes. SMSFs can be used to invest in Unit Trusts, and most of our investments are structured as Unit Trusts. To ensure that your SMSF investment is compliant with ATO regulations, we recommend engaging the services of licensed professionals to assist if you have not already done so.
We provide our investors with regular updates on the progress of all projects via this website, direct email, and a private Facebook group.
Our investor community is a diverse group of Australian and international investors united by their need for a reliable investment model that provides them financial freedom and flexibility.
