Investors rush to buy into Cromwell’s Ipswich City unlisted property trust

Cromwell Property Group has recorded a strong investor response to its Ipswich City Heart Trust. an unlisted single property trust comprising the $93 million Ipswich City Heart Building currently under construction in the Ipswich CBD.

More than 800 investors invested around $50,000 each in the trust, with the offer oversubscribed and closing early. 

The trust has raised around $50 million in total.

The nine-storey commercial office and retail building is being built at 117 Brisbane Street and will have the Queensland government’s Department of Public Works as the major tenant.

The trust is a seven-year investment distributing 8% per annum paid monthly to investors and offering capital growth potential and tax-deferred income.

The building is the first stage of ICON Ipswich, a $1 billion revitalisation project that will span four city blocks and deliver approximately 170,000 square metres of master-planned commercial, retail, residential and public space to deliver a “new generation” city centre.

The Department of Public Works will occupy 91% of the 15,600 square metres of office space. There will be an additional 2,134 square metres of retail space over the lower ground, ground and mezzanine levels.

Cromwell CEO Paul Weightman said the recent announcement of an increase in forecast trust distributions (from 7.75% to 8%) combined with falling official interest rates significantly boosted the rate of inflows.

Apart from the 8% annual return, Weightman said expectations of further falls in interest rates made the investment “extremely attractive to yield-conscious investors”.

“The strong response from investors proves the continuing appeal of simple, transparent, yield-based products underpinned by quality Australian commercial property assets,” he added.

Construction of the building commenced in January 2012 and is on target to be completed by September 2013.

“Given the level of inflows over the last two to three months, Cromwell is now focused on meeting this demand for quality direct property by bringing another similar opportunity to market over the next few months,” said Weightman.

Larry Schlesinger

Larry Schlesinger

Larry Schlesinger was a property writer at Property Observer

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