Stay ahead of change and keep your business growing in 2025

Stay ahead of change and keep your business growing in 2025

by | Apr 7, 2025 | Alternative finance, Business and Investment

Business growth in today’s rapidly disruptive economic landscape is a real challenge. Australian businesses face a myriad of challenges and opportunities. With the federal election on May 3, 2025, many enterprises are adopting a “wait and see” approach, uncertain about future policies and economic directions. However, proactive planning and strategic action can position your business for sustained growth, regardless of political outcomes.

At Accrutus Capital, we believe that staying ahead of change is not just about adaptation to survive, but about seizing opportunities to thrive.

Navigating Economic Uncertainty in 2025

The Australian economy is experiencing significant shifts influenced by both domestic and global factors. Inflationary pressures persist, and interest rates remain elevated, impacting borrowing costs and consumer spending patterns. Supply chain disruptions, partly due to geopolitical tensions and realignments in global trade, have further complicated the business environment. These factors collectively contribute to a landscape where caution is understandable, but inaction can be detrimental.

The upcoming federal election adds another layer of uncertainty. Historically, businesses have tended to delay major decisions during election periods, awaiting clarity on potential policy changes. While this approach is common, it may result in missed opportunities, especially when competitors choose to act decisively.

Now is the time to strengthen your foundation, explore funding options, and position your business for long-term growth.

business growth and trade
Improve cash flow while preserving working capital

100% funding including deposit requirements

Utilise early payment discounts from suppliers

The Impact of Globalisation on Local Economies

Globalisation has brought numerous benefits, including access to broader markets and diversified supply chains. However, it has also led to unintended consequences for local economies. The outsourcing of manufacturing and services to overseas markets has contributed to job losses in various Australian industries. Rural towns, once vibrant with local industries, have particularly felt the impact, with some communities experiencing economic decline and reduced employment opportunities.

The Organisation for Economic Co-operation and Development (OECD) highlights that certain groups face a higher risk of poverty due to these shifts, and laid-off workers often encounter difficulties in securing new employment.

This underscores the need for policies and business strategies that prioritise local economic development and job creation.

Now, both consumers and governments are shifting focus: Buy local. Build local. Support local.

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You don’t need to gamble your future to grow.

Here’s how to scale smartly—even in uncertain times:

✅ 1. Know Your Numbers
Understand your cash flow, liabilities, and working capital.
✅ 2. Use Your Invoices as Leverage
Don’t wait 30+ days to get paid.
Invoice finance turns your unpaid invoices into instant working capital.  Learn about Invoice Finance
✅ 3. Tap Into Trade Finance
Manage supplier payments and stay on top of operations. Discover Trade Finance Options
✅ 4. Build a Buffer
Always have a contingency fund or a pre-approved facility ready.
Need tailored finance options? Book a call with our team 07 3184 9183.

What You Can Do to Finance Your Business Growth in a Measured Way

In uncertain times, prudent financial management becomes paramount. Expanding your business requires capital, but it’s essential to approach financing strategically to avoid over-leveraging. Here are some steps to consider:

1. Assess Your Financial Health: Conduct a thorough review of your current financial position. Understand your cash flow, outstanding debts, and creditworthiness.
2. Explore Diverse Financing Options: Beyond traditional bank loans, consider alternative financing solutions such as trade finance and invoice finance. These options can provide the necessary liquidity without the stringent requirements of conventional loans.
3. Leverage Assets: Utilise existing assets, such as unpaid invoices, to access immediate funds. Invoice finance allows businesses to unlock up to 95% of the value of outstanding invoices, enhancing cash flow.
4. Plan for Contingencies: Develop a financial buffer to navigate potential downturns. This ensures that your business remains resilient in the face of unforeseen challenges.

At Accrutus Capital, we specialise in providing tailored financial solutions that align with your business objectives, ensuring sustainable growth without compromising financial stability.

Business Growth opportunity

Business Growth Through Local Manufacturing

Reinvesting in local manufacturing presents a compelling opportunity for Australian businesses. By bringing production closer to home, companies can reduce supply chain vulnerabilities, create local jobs, and contribute to the revitalisation of regional economies.

The manufacturing sector is poised for transformation, with trends indicating a shift towards sustainability and advanced technologies. Embracing practices such as automation, artificial intelligence, and sustainable manufacturing can enhance competitiveness and open new market opportunities.

Moreover, government initiatives aimed at supporting local industries may provide additional incentives for businesses to invest in domestic manufacturing. Staying informed about policy changes post-election will be crucial in leveraging these opportunities.

Local manufacturing is making a comeback and for good reason:
• More control over supply chains
• Faster production timelines
• Stronger support from consumers

Key growth areas in Australia:
• Advanced manufacturing
• Food & beverage production
• Sustainable textiles and materials

Top emerging industries in Australia
  • AI and automation projected $2.5B market by 2025
  • Hydro-electric power part of the energy transition
  • Sustainable agriculture ethical supply chains, ESG capital ready
  • Cybersecurity and Fintech resilient, scalable, global.

Industry Disruption – Business Growth Opportunities

Disruption always brings opportunity.

The current economic climate is characterised by both disruption and innovation. Industries such as hydro-electricity generation and beef cattle feedlots are experiencing significant growth, indicating a shift towards renewable energy and sustainable agriculture.

Additionally, the rapid advancement of technologies like artificial intelligence presents opportunities across various sectors. Australia’s AI industry, for instance, is projected to grow by 27.3% annually, reaching $2.5 billion in 2025.

Businesses that proactively embrace these trends, invest in innovation, and adapt to changing market demands will be well-positioned for future success.

While the instinct to adopt a “wait and see” approach during periods of uncertainty is understandable, proactive and strategic actions can set your business apart.By exploring measured financing options, investing in local manufacturing, and staying attuned to emerging industry trends, you can navigate the complexities of the current economic landscape and achieve sustainable growth.

At Accrutus Capital, we are committed to partnering with Australian businesses to provide the financial solutions and insights needed to thrive in a changing world.

Stay ahead of change. Grow with confidence. Partner with Accrutus Capital.

Accrutus Capital is committed to increasing awareness for SMEs providing this generic business cash flow checklist. We can advise on different trade finance options, saving you time and money.
Call us today at 07 3184 9183 and speak to our trade finance specialist. Together we will devise a plan to help boost your cash flow with up to $5 million approved facility ready when you are.

Looking to fund your business growth?

Working Capital to $5 million

  • Set your own trading terms
  • Track and manage your supply chain
  • Tailored facilities from $100K to $5 million
  • Pay your international suppliers with market leading FX rates
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DISCLAIMER

The disclaimer covers content, comments, responsibility, links, government and local laws, jurisdiction and communication methods. None of the contents on this website or blog should be construed as any kind of advice or recommendation. Nothing in it should be taken to constitute a statement that is intended to influence a person or persons in making a decision regarding any investment or financial product. This website or blog does not purport to be complete, accurate or contain all information which its users may require to make an informed assessment of whether to invest in any Offer listed through Accrutus Capital Pty Ltd.

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Leverage assets manage tariff impact protect trade

Leverage assets manage tariff impact protect trade

by | Mar 15, 2025 | Alternative finance, Business and Investment

Leverage assets for stability. The global trade landscape is shifting, and Australian businesses must stay ahead of the curve to mitigate risks and seize emerging opportunities. The recent U.S. tariff impact is reshaping supply chains, altering costs, and challenging trade partnerships. Whether an importer, exporter, depends on overseas supplies, or manufactures, the changes will affect you. The key to staying competitive lies in strategic financial decisions and leveraging assets for growth.

Trade finance

Stay ahead of the economic changes and secure your business’s financial future.

Understanding the Tariff Impact on Australian Businesses

The US has introduced a 25% tariff on steel and aluminium imports, impacting global trade flows. Australia, previously exempt from certain tariffs, now faces increased costs and uncertainty in trade relations. This shift presents both threats and opportunities depending on your business model:

  • Importers will see rising costs on U.S. goods, requiring renegotiations with suppliers or a pivot to alternative sources.
  • Exporters may lose competitiveness as tariffs drive up prices for Australian products in the U.S. market.
  • Manufacturers relying on overseas materials could face higher production costs, pushing them to explore local supply options.
  • Domestic producers may find an opening to replace imported goods with locally manufactured alternatives.

Adapting to these changes requires a proactive approach to secure financial stability using asset finance.

By taking proactive steps and leveraging available financial strategies, businesses can turn potential threats into opportunities. Ensuring long-term success in a shifting global trade environment.

Leverage Financial Assets

Leveraging Assets to Overcome Tariff Challenges

Rather than resorting to high-cost, short-term unsecured loans, businesses can leverage assets to fund operational shifts, supplier changes, or expansions. Here’s how asset-backed financing can be a game-changer in the face of tariff disruptions:

1. Use Asset Finance to Maintain Liquidity
Liquidity is crucial when facing tariff-related price increases. By using asset finance, businesses can unlock capital tied up in real estate, equipment, or inventory. This approach ensures access to funds without taking on unnecessary debt.
• Real estate-backed financing allows business owners to extract value from commercial or residential properties.
• Equipment financing helps manufacturers upgrade machinery to stay competitive without exhausting cash reserves.
• Invoice financing turns outstanding payments into immediate working capital, helping importers and exporters manage cash flow disruptions.
2. Leverage Assets to Reposition Your Business Model
The tariff impact may require businesses to shift strategies. Whether it’s sourcing from different markets, expanding domestic production, or investing in technology. Having access to capital is essential.
• Importers can pivot to local suppliers by financing initial bulk purchases through asset-backed loans.
• Manufacturers can expand production facilities to capitalize on the reduced reliance on imported goods.
• Retailers can diversify product lines by securing new supplier contracts with upfront financing from their existing assets.
3. Fund Growth Without Strangling Future Financing
One of the biggest pitfalls businesses face is over-reliance on unsecured loans. This can limit future funding opportunities. With asset finance, companies can grow sustainably without high-interest debt obligations that restrict long-term expansion.
• Instead of costly short-term loans, asset-backed lending allows repeated leveraging of appreciating assets.
• Businesses can reinvest the funds strategically, whether for acquisitions, supplier diversification, or technological upgrades.
• Selling assets strategically can serve as a safety net in times of economic uncertainty.

 

Key Financial Strategies for Businesses Facing Tariff Impact

To navigate the complexities of the new trade environment, Australian businesses should adopt a structured financial approach. Here are critical steps to remain resilient:

Renegotiate Supplier Agreements

Given the tariff impact, suppliers may be open to discussions about pricing adjustments or extended payment terms. Businesses should:
• Explore alternative sourcing options from non-U.S. markets.
• Negotiate bulk order discounts to offset increased costs.
• Establish long-term contracts to stabilize pricing.

Secure Alternative Capital for Expansion

Business growth often requires external funding. Asset finance provides a strategic way to access large capital injections without depleting working capital.

Companies should:
• Consider private capital options, which offer approvals within 24 hours.
• Take advantage of property-backed loans with rates starting at 7% p.a.
• Leverage assets to access up to $100 million in financing for operational shifts.

Invest in Technology and Infrastructure

Modernizing operations can help businesses stay competitive despite tariff-related cost pressures. Using asset finance, businesses can:
• Upgrade software and hardware to improve efficiency.
• Invest in automation to reduce dependency on costly imported labor or materials.
• Expand premises to accommodate increased local production.

Consider Merges and Acquisitions

With tariffs reshaping the market landscape, some businesses may find it beneficial to acquire competitors or merge with strategic partners. Leveraging assets can provide the capital needed for:
• Purchasing distressed competitors at a reduced cost.
• Expanding into new markets via acquisitions.
• Strengthening supply chain stability by acquiring key suppliers.

leverage assets manage tariffs

The Role of Accrutus Capital in Helping Businesses Adapt

Accrutus Capital specializes in alternative financial solutions, helping Australian businesses leverage assets to fuel growth and resilience in uncertain times.

Their services include:
• Private capital access with rapid approvals.
• Flexible loan terms ranging from 3 years or longer.
• Funding solutions from $5 million to $100 million, with LVRs of up to 75%.
• Tailored asset finance options to match unique business needs.

Final Thoughts: Preparing for the Future

The evolving tariff impact presents both challenges and opportunities for Australian businesses. By leveraging assets and employing smart financial strategies, companies can turn obstacles into growth potential. Whether it’s shifting supply chains, expanding operations, or investing in technology, asset finance offers a reliable path to profitability.

Stay ahead of the economic changes and secure your business’s financial future. Contact Accrutus Capital today to discuss how leveraging assets can help you navigate the U.S. tariff impact.

Call us today at 07 3184 9183 and speak to our finance specialist.

Qualify for Assets Finance

To take advantage of asset finance, businesses typically need:
• A property-related asset, such as a commercial or residential property.
• A clear exit strategy for how the loan will be repaid.
• Proof of funds utilization, such as purchase orders or invoices.
• Recent mortgage statements and property rates notices.

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DISCLAIMER

The disclaimer covers content, comments, responsibility, links, government and local laws, jurisdiction and communication methods. None of the contents on this website or blog should be construed as any kind of advice or recommendation. Nothing in it should be taken to constitute a statement that is intended to influence a person or persons in making a decision regarding any investment or financial product. This website or blog does not purport to be complete, accurate or contain all information which its users may require to make an informed assessment of whether to invest in any Offer listed through Accrutus Capital Pty Ltd.

Leveraging Alternative Finance Solutions for SME Success

Leveraging Alternative Finance Solutions for SME Success

by | Jun 15, 2024 | Alternative finance, Small Business Finance

Alternative finance solutions may be the missing link when building a successful business that is challenged, especially during an economic downturn. However, understanding how to navigate a tough market is essential for the long-term sustainability of your business. In this article, we’ll explore how a challenging economy impacts businesses and discuss financial solutions available, including working capital finance, alternative capital, unsecured business loans, asset finance, and business line of credit.
know how to navigate a tough market …

Alternative Finance Solutions
Utilize working capital finance to maintain daily operations and cash flow

Consider unsecured business loans for flexible, collateral-free funding

Leverage alternative finance solutions for goods and services minimize upfront costs

Leveraging Alternative Finance Solutions for Success

The alternative finance sector continues to evolve with technological advancements and changing market dynamics. The integration of artificial intelligence and machine learning in credit assessment processes is streamlining risk evaluation, expediting loan approvals. Additionally, the rise of peer-to-peer lending platforms and crowdfunding initiatives is democratizing access to capital.

According to a report by Statista, the global alternative lending market is projected to reach $490.51 billion by 2025, with a compound annual growth rate (CAGR) of 21.1% from 2020 to 2025. This robust growth highlights the increasing acceptance of alternative finance solutions among businesses worldwide.

What effects can a tough economy have on a businesses?

During an economic downturn, businesses often face reduced cash flow due to declining revenue, increased debt to cover rising costs, and limited access to additional capital. This restricted cash flow can hinder efficient operations, investment, and innovation, impacting a business’s ability to weather financial storms and achieve growth.

Tough economies can manifest in various forms and are often caused by multiple factors. Typically, an economic downturn results in reduced demand for products or services, stemming from recessionary periods, financial uncertainty, geopolitical shocks, or other disruptive events. These conditions can lead to lower consumer spending, reduced supplier stability, and overall market pessimism, creating significant challenges for businesses.

An economic downturn is a decline in the growth rate of Australia’s gross domestic product (GDP). GDP is the total market value of all goods and services produced within Australia. More information from Business Queensland website ‘ Surviving an economic downturn’ .

alternative finance solutions
Download Free Cash Flow Checklist
Explore trade finance to facilitate reliable international trade agreements

International Trade Finance
Use invoice finance to convert outstanding invoices into immediate cash flow

5 Alternative Financing Options to Explore

Working capital finance is essential for maintaining daily operations and meeting short-term obligations. Traditional banks often have stringent requirements and lengthy approval processes, which can be restrictive. In contrast, working capital finance offers faster and more flexible solutions, enabling businesses to access funds quickly, maintain cash flow, and seize growth opportunities without traditional lending constraints.

Unsecured business loans are a standout feature of alternative finance. Unlike conventional loans requiring collateral, unsecured loans are based on the creditworthiness and potential of the business. This is particularly beneficial for startups and SMEs that may lack substantial assets. According to the SME Finance Forum, 40% of SMEs globally face significant financing gaps. Unsecured business loans provide essential capital for expansion, technology investment, and enhanced competitiveness.

Asset finance allows businesses to acquire necessary assets without incurring large upfront costs, preserving cash flow. This is particularly beneficial during tough economic times, as it enables ongoing operations and growth without depleting financial reserves. By leveraging existing assets such as equipment or vehicles, businesses can access funds needed for expansion, upgrades, and operational improvements, maintaining agility and market share.

Invoice finance provides businesses with immediate access to cash by converting outstanding invoices into liquid assets. This method improves liquidity and reduces the risk of cash flow disruptions, allowing businesses to continue trading successfully without waiting for prolonged payment terms from customers. Improved access to reliable working capital helps businesses navigate uncertain times and focus on strategic initiatives and long-term planning.

Trade finance is vital for businesses involved in importing and exporting. It facilitates new trade agreements with trust and reliability through third-party financiers, ensuring payment and service provision. During difficult financial times, maintaining and creating strong trade relations with suppliers and customers is crucial. Trade finance enables businesses to persevere and recover through economic downturns.

The Competitive Edge of Alternative Finance

Alternative finance solutions offer a competitive edge through speed, flexibility, and accessibility. Unlike traditional lenders, alternative finance providers use advanced technology and data analytics for quicker approval processes. This agility is crucial for SMEs in fast-paced markets, where timely access to capital can mean the difference between seizing opportunities or missing out. Alternative finance also caters to a broader range of businesses, including those with limited credit histories or unconventional business models, fostering innovation and entrepreneurship.

In a challenging economy, alternative finance solutions such as working capital finance, unsecured business loans, asset finance, and cash flow solutions provide SMEs with the tools needed to thrive. These flexible and accessible funding options align with the unique needs of each business, helping them maintain operations, seize growth opportunities, and achieve long-term sustainability. Embracing these alternative finance solutions is a strategic choice, paving the way to sustainable success in a competitive landscape.

Visit Accrutus Capital website to learn more about alternative finance options to help you business or call 07 3184 9183.

Finding your business bank too restrictive?

Alternative Finance Solutions 101
  • bespoke structured facilities
  • ideal for manufacturing, logistics, property projects, supply chain, food and retail.
  • leveraged options from $100K to $5 million.
  • digital payment platforms for local and global trade.
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DISCLAIMER

The disclaimer covers content, comments, responsibility, links, government and local laws, jurisdiction and communication methods. None of the contents on this website or blog should be construed as any kind of advice or recommendation. Nothing in it should be taken to constitute a statement that is intended to influence a person or persons in making a decision regarding any investment or financial product. This website or blog does not purport to be complete, accurate or contain all information which its users may require to make an informed assessment of whether to invest in any Offer listed through Accrutus Capital Pty Ltd.

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Real Estate Investment Alternative REIT

Real Estate Investment Alternative REIT

by | Mar 28, 2023 | Business and Investment, Real Estate Investment

Real Estate Investment Trusts or REIT can provide potentially high returns for investors seeking to diversify their portfolios, but it isn’t always a straightforward process.

Real Estate Investment Trusts can offer investors a way to get access to the real estate market without having to own physical property. Accrutus Capital will discuss listed and unlisted property trusts, and why you should consider investing in one. We’ll also look at the benefits of the various structures;

  • understanding the different types of property trusts available in Australia
  • considerations for tax implications associated with REIT investments
  • strategies for investors and how to diversify your portfolio
  • example for ‘Convenience Plus’ and unlisted managed trusts as an alternative for diversification.

Real Estate Investment Alternatives

Are an increasingly popular way to invest in the property market. The structure provide investors with access to a range of properties, from residential and commercial buildings to retail centres and industrial warehouses, without having to commit large amounts of capital.

They offer many advantages such as diversification over multiple asset classes, mitigating risk by spreading investment across different locations, and reduced transaction costs due to economies of scale. There is also potential for higher returns compared to traditional forms of property investing due to leveraging the expertise of professional fund managers and the ability to tap into larger deals which would otherwise be difficult for individual investors.

Benefits of Investing in a REIT

• REITs offer investors a range of high-quality real estate classes such as residential, industrial, commercial and shopping centres, by purchasing units in a Trust Fund.

• They are highly liquid and transparent, making them more attractive than traditional forms of property investment.

• Leveraged opportunities from the professional fund and asset managers can help increase returns.

• Regulation by the Regulator provides increased protection ensuring investment compliance and stringent governance and reporting standards.

Understanding the different types of Property Trusts in Australia

A property trust is a pooled investment vehicle that allows investors to invest in a portfolio of income-producing real estate assets. These assets could include offices, shopping centres, hotels, healthcare facilities, etc.

They provide investors with a diversified portfolio, professional management, and consistent income distributions while offering degrees of liquidity dependent if the investment into an unlisted or listed REIT.

An unlisted property trust allows investors to pool their money into a Managed Investment Fund that acquires substantial commercial property assets that they couldn’t buy on their own.

it is important to understand the different types available before making any decisions. These property trusts can be categorized into wholesale, retail, direct tax-deferred, and hybrid trusts, each offering varying benefits that may suit your investment requirements.

Listed Property Trust A-REIT’s are publicly traded on the Australian Securities Exchange (ASX) and can be bought and sold like other publicly traded stocks. Investors can buy and sell shares in REITs, and the prices are determined by market supply and demand.

Unlisted Property Trusts are not publicly traded and are offered by private real estate investment companies, or fund managers to a select group of investors, such as institutional investors or high net worth individuals.

Knowing which type best suits your investment needs can help you maximize returns and limit risk when adding real estate to your portfolio. Consult your accountant when investing to understand the taxation implications.

The Australian financial and tax regulations governing managed investment trusts or schemes can be found on the Australian Securities and Investment Commission’s (ASIC) website. While detailed taxation guidelines can be found on the Australian Taxation Office website.

Strategies for Investing in REITs

Diversification: Investing in REITs allows investors to spread their risks across various property sectors and geographical locations, reducing the impact of a downturn in any specific sector or area.

Income: Invest in REITs that provide consistently high dividend yields, helping to supplement other income sources and could serve as a hedge against inflation.

Growth Prospects: Identify REITs with strong growth prospects by assessing the quality and potential of their underlying assets, as well as the capability of the management team.

Taxation Benefits: Consider the tax advantages associated with REITs, such as tax-deferred distributions and the ability to claim deductions for property expenses and borrowing costs [3].

Considerations for Investing in REITs for tax benefits in Australia

  • Understand the tax treatment of REITs

A-REITs are generally taxed as trusts, meaning they are required to distribute at least 90% of their taxable income to investors. This income is taxed in the hands of investors at their marginal tax rate, which could be lower than the company tax rate paid by direct property investors.

Additionally, investors can claim deductions for expenses related to their investment in the property trust, such as management fees and borrowing costs.

  • Consider investing in tax-effective structures

Investors can invest through tax-effective structures such as self-managed super funds (SMSFs) and family trusts. SMSFs offer significant tax benefits, such as concessional tax rates on investment earnings and access to franking credits. Family trusts can also provide tax advantages by allowing income distributions to be split among family members, potentially reducing the overall tax liability.

  • Evaluate the tax implications of different types of REITs

Investors should consider the tax implications of investing in different types of property trusts. Some may focus on properties that generate tax losses, which can be offset against other income to reduce the overall tax liability. However, investors should be careful to avoid investing solely to generate tax losses, as this may be viewed as a tax avoidance scheme.

  • Assess the investment strategy of the Trust

Investors should carefully evaluate the investment strategy of the property trust to ensure it aligns with their investment goals and risk tolerance. Some may focus on specific property types, such as retail or industrial, while others may have a more diversified portfolio. Additionally, investors should consider the geographic diversification of the assets and its exposure to different markets.

  • Monitor the performance of the Trust

Investors should regularly monitor the performance of the REIT to ensure it continues to meet its investment goals and objectives. Key metrics to consider include the distribution yield, Funds from Operations (FFO), price-to-FFO ratio, occupancy rates, and rental growth. Additionally, investors should be aware of any changes in tax legislation that may affect the tax treatment of their investment.

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How investors can diversify their portfolio into ‘Convenience Plus’ asset classes

FRP Capital, a leading investment and asset manager specializing in convenience-based shopping centres around Australia, is located in highly valuable urban locations, such as close to transport hubs, universities, industrial and commercial precincts or entertainment complexes. Offer an excellent showcase of an unlisted portfolio. Their latest offering is 4.9klm from Adelaide’s CBD. This highlights the experience, and knowledge of the management team by acquiring quality assets offering strong occupancy of 96%.

FRP Capital acquires off-market properties that provide high levels of rental income while also offering the opportunity for capital growth and tax benefits over the longer term.

Unlisted Real Estate Investment Trusts

As an asset class, unlisted property delivered total 12-month returns of 17.7 per cent in FY22, outperforming direct and listed property, Australian and global equities, fixed income and cash returns. Importantly, this outperformance stacks up over a five-year period, with unlisted property producing a five-year annualised return of 16.6 per cent. (Source: Livewire – Property).

A recent acquisition into the FRP Capital Managed Trust Fund portfolio is the former brickworks factory converted in 2015 into a thriving retail destination. This acquisition demonstrates the importance of expert asset management and the ability to identify and capitalize on unique investment opportunities. 

Brickworks Marketplace Fund offers investors high yields and tax-efficient distributions. As an unlisted, Trust is required to distribute at least 90% of its taxable income as dividends to investors, providing a tax-efficient investment vehicle. The trust has also provided investors with attractive dividend yields over the years, with an average distribution yield of 6.07% annually.

 

Accrutus Capital, the Corporate Advisory assisting FRP Capital (ACN 643 942 116) (The Investment Manager), is an authorised representative #001283664 of Lantern RE Limited, holder of AFSL Licence #386569.

Accrutus Capital specialises in raising capital from wholesale and sophisticated investors under Section 708 of the Corporations Act 2001.

By reaching out to Accrutus Capital you can gain access to their select portfolio of exclusive investment opportunities in the Australian real estate market.

In conclusion, understanding the alternatives in real estate investment, and implementing the right strategies can lead to fruitful investments with diversified income sources and attractive taxation benefits.

Partnering with an experienced corporate advisors such as Accrutus Capital can further amplify your alternative real estate investment options with unlisted off-market opportunities.

DISCLAIMER

This article is intended for sophisticated and wholesale investors user Section 708(6,8,10) of the Corporations Act 2001. The information provided in this article is of a general nature and should not be relied upon as professional advice. You should seek independent advice tailored to your specific circumstances before making any decisions. Accrutus Capital and FRP Capital do not accept any responsibility for any loss that may arise from reliance on the information contained in this article. We do not give any advice or recommendation.

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Invest in Australia

Invest in Australia

by | Sep 9, 2018 | Business and Investment

Australia is an attractive location for foreign investors to capitalise on a broad range of business and investment opportunities. The Australian Government welcomes foreign investment, and has an open foreign investment policy, therefore making it safe and secure for foreign investors to migrate, do business and invest in Australia.

Robust Economy   |   Dynamic Industry   |   Innovation Skills   |   Global Ties   |   Strong Foundations

Invest in Australia as a nation that is at the forefront of research and development, education, business and innovation. Our natural resources are limitless which provide vital energy supplies to the world. Medical and technical advancements abound resulting in a high quality of life. This article is designed as a quick introduction to the Business Innovation and Investment  VISA 188 (Subclass) applicants exploring how to invest in Australia.

Why Invest and do Business in Australia?

Australia ranks in the top 5 countries to immigrate and the nation was built on colonial settlement from 1788 with the arrival of the First Fleet of British ships to Sydney, New South Wales. Since then Australia has developed into second and third generation immigrants who have found a home in Australia.

 

  • One-third of all majority foreign-owned businesses operating in Australia are investments from the US, the UK and Japan combined, therefore account for half of the employment among all majority foreign-owned businesses.
  • Almost two-thirds of exports from majority foreign-owned businesses are generated from US, UK and Japanese-owned businesses.
  • Foreign-owned businesses also contribute significantly to Australia’s IVA. Businesses from the US, UK and Japan contribute around 10 per cent (combined) of Australia’s IVA, resulting in 10 per cent of total business assets are held by foreign-owned businesses from the US, the UK, Japan and Switzerland.  (source: Austrade)

How to Invest in Australia?

  • Your migration agent or attorney can work with our business broker to help you gain more knowledge about how to invest in Australia and select your target business
  • Understand the local legal and financial environment particularly the Foreign Investment Review Board (FIRB). Confirm any regulatory approval requirements before you buy a business or invest in Australia
  • Structure your financial situation in advance to ensure an optimal outcome and potentially avoid legal pitfalls
  • Plan for long-term and short-term business funding to prepare for situations outside your control. Because each country has different finance rules and regulations which take time to work through
  • Spread your risk and resources, but most importantly make an informed decision about the sector your planning to invest in Australia
  • Think strategically long-term and have an exit plan in mind. While integration is difficult and time-consuming, it can make the difference between successful and unsuccessful deals

Advantages of Investing in Australia 

Climate

Invest in Australia while enjoying your perfect climate from high temperatures and humidity in the tropical north to temperate Sydney weather to below freezing in the Canberra and Snowy Mountains regions

Quality of Living

Australia’s is rated the 9th highest in the world, according to the 2017 Social Progress Index. Sydney ranks 10th globally. Melbourne 16th and Perth comes in at 22nd according to the Mercer 2017 Quality of Living Rankings.

Tourism

Almost 279,000 businesses across sectors such as accommodation, cafes, restaurants and takeaway food services, retail and transport. According to the latest statistics available (as at 30 June 2016). The industry employes around 890,000 people and the total Australian workforce for 2016-17, consequently increasing from 4% to around 924,600. Australia experienced record inbound tourism in 2016-2017 driven by strong growth from China, Malaysia, Hong Kong

Economic System

The financial, regulatory, legal, political and economic systems are well established and provide security to Investor Stream applicants looking to invest in Australia

Ageing Population

Australia’s (baby boomer) population is fueling the development sector in aged care and health services. Baby boomers are typically healthier and wealthier than their parents, thereby living longer and re-defining the housing market

Internal Migration

Internal and external immigration stimulates the housing and building economy.  Therefore, immigration has an enormous role to play in the Australian property market. About 55% of our massive population growth is made up of migrants from overseas

Major infrastructure

Spend by governments and private partnerships benefit growth planned around Australia. For example, Nowra and Western Sydney north rail link in NSW. The rail upgrade and duplication in Victoria. The Bruce highway and Beerburrum rail, and Cunningham Highway upgrades in QLD to name a few

Trade

Australia’s easy access via sea and air is a major factor for import and export services especially, in the Asian region. Hence, two-way trade in 2016 was A$673 billion, which made up 40% of our GDP. Nine of Australia’s 12 largest markets have a total trade of A$373 billion are within the Asian region

AUSTRALIAN INVESTMENT OPPORTUNITIES

Business Innovation and Investment VISA
(Subclass 188)

Visa applicants working with their respective migration agents and seeking nomination by an Australian State or Territory government must lodge an Expression of Interest (EOI) through the SkillSelect system. This article ‘Invest in Australia‘ is written as a guide for those applicants considering migrating to Australia through the ‘Business Innovation and Investment Visa 188 (subclass)
Invest in Australia

188 VISA allows you to

  • invest in Australia through establishing a new or develop an existing business or
  • make a designated investment with an Australian state or territory government or
  • participate in a complying entrepreneurial activity in Australia
  • make and maintain a complying investment in Australia or
  • travel in and out of Australia for the life of your visa
  • bring members of your family unit with you to Australia
  • seek permanent residence by applying for a Business Innovation and Investment (Permanent) visa (subclass 888)

Invest in Australia FIRB approval for

  • Foreign government investors
  • Agribusiness
  • Media sector
  • Land rich entities

Invest in Australia – QUICK FACTS

  • The visa is valid for four years and three months from the date it is granted.
  • Applicants for a subclass 188 visa in any stream prior to 1 July 2015, may apply for a subclass 888 permanent visa after 3 years and 11 months.
  • Possible extension stream if you hold this visa under the Business Innovation stream or the Significant Investor stream to meet criteria.
  • If you hold this visa under the Investor stream or Premium Investor stream, you cannot apply for an extension stream under this visa.
  • Business Innovation stream provisional visa holders can apply for one extension up to six years.
  • Significant Investor stream provisional visa holders can apply for up to two extensions to eight years.
  • Each extension stream lets you stay and invest in Australia for another two years.
Doing business in Australia

Australian Investor Obligations

Foreign Investment Review Board (FIRB)

The Australian Government expects all entities seeking to invest in Australia to maintain the highest standards of corporate behaviour. Irrespective of whether those entities are Australian or foreign owned. Persons wanting to invest in Australia or involved in operating these entities are expected to understand Australia’s regulatory environment and abide by all the relevant requirements. Foreign investors should be aware of their obligations outlined in the link below. These requirements are ongoing and may change from time to time. Accordingly, investors are expected to keep themselves up to date with the FIRB and changes to their obligations that may occur.

INVESTMENT OPPORTUNITIES

Property

  • Australia has seen a strong population growth which will continue to underpin the property markets. Last year, Australia’s population grew by 389,100 people to reach 24.5 million by the end of March 2017
  • Invest in Australia for housing which has averaged approximately 164,000 dwellings over the last 5 years. The demand will continue to 2021, therefore continuing strong population growth (underpinned by net migration of 240,000 per anum)
  • Household and demographic shifts in composition (more one and two-person households), means Australia is likely to grow by 172,000 households a year, resulting in a 5% increase in demand

Health and Aged Care

  • Invest in Australia $20 billion aged care sector, which employs over 224,000 staff across more than 1,800 businesses. Caring for over 270,000 elderly and disabled Australians across the country
  • Australian baby boomer generation is reaching saturation point the aged care sector is the fastest growing market in this country.
  • This baby boomer demographic born between 1946-1965 is estimated to be 5.5 million in 2017
  • Baby boomers are set to change the healthcare industry and the provision of aged care in the years ahead

Telecommunications

  • Invest in Australia with a record of groundbreaking innovations. Most noteworthy technologically connected workforce facilitating our highly educated, multi-cultural and multilingual society
  • A vibrant telecommunications industry lies at the heart of furthering the digital imperative for Australia’s future generations
  • Per capita, Australian is the 3rd largest connected country with access
  • Connected households with internet access currently about 86.1% and mobile broadband subscriptions are 132.5 per 100 inhabitants

Why Invest in Australia?

The economy has outperformed other countries for more than two decades, as a result is achieving great success in global markets. The full report can be found here ‘Why Australia’ BENCHMARK REPORT 2018 from the Australian Trade and Investment Commission (Austrade)

Robust economy

The Australian economy is forecast to be the 13th largest in the world and the fifth largest in the Asian region in 2018, despite the fact the country is home to only 0.3 per cent of the world’s population. Australia’s nominal GDP is estimated at US$1.5 trillion (A$1.9 trillion) resulting in 1.8 per cent of the global economy. Australia has almost tripled the value of its total production from two decades ago

Why invest in Australia

Dynamic industries

The country is a leading provider of goods and services that are in high demand across the global economy. Australia is a major producer of natural resources, including significant liquefied natural gas reserves. Clean, green agricultural commodities and premium food are coming into production. Operates in sophisticated financial markets, including the world’s sixth largest pool of managed fund assets, and a  noteworthy leading destination for education and tourism

Why invest in Australia industry

Innovation skills

Australia is an ingenious nation that invented the black box, penicillin for civilian use, high-speed WIFI, the cervical cancer vaccine and Google Maps, among other innovations. Invest in Australia entrepreneurship funds and programs on the rise. One of 9 OECD countries that recorded an increase in the number of new businesses between 2013 and 2017. Almost half of all Australian firms are innovation-active, laying the groundwork for future discoveries

Why Invest in Australian Innovation

Global Ties

The dynamic Asian region integration is driving wealth creation and overall economic growth. Of the top 12 export markets in 2016, ten were in the Asian region and all were rated above investment-grade. Their combined value was around A$227 billion, making up more than two-thirds of Australia’s total goods and services export earnings of A$330 billion in 2016

Investment in Australian Goods

Strong Foundations

The country is one of the easiest places in the world to do business, ranking 14th out of 190 economies. It takes around 2.5 days and a minimum of three procedures to start a business. Australia also ranks particularly well for enforcing contracts (3rd globally), getting credit (6th) and dealing with construction permits (6th).

Invest in Australian Business
AUSTRALIAN INVESTMENT OPPORTUNITIES

FOREIGN INVESTMENT INFLOW 

The latest confidence indicator towards Australian housing market remained positive in Q4, although waning compared to previous quarters. NAB’s view for 2018 largely unchanged.

The NAB’s quarterly residential property survey Q1-4 report tracks opinions of around 250 property market experts such as real estate agents, property developers, fund managers and owners.

The share of foreign buyers in Australian housing markets however continued to fall in Q4, dropping to a 6 year low 8.4% in new property markets and a 5-year low 5.5% in the established housing market.

World Investment Report 2018

Foreign direct investment (FDI) inflows to Australia, which more than doubled in 2016, maintained their high level at US$46 billion in 2017.

According to the United Nations Conference on Trade and Development’s (UNCTAD) World Investment Report 2018, Australia remained in the top ten global destinations for FDI.

From 2011 to 2017, Australia attracted an annual average of US$47 billion in FDI inflows, compared with an average of US$28 billion over the previous term (2004 to 2010). This represents a growth rate of 70% over the two periods, well above the world average of 24% and developed economies of 12%.

This solid growth has raised Australia’s share of global FDI inflows to 3% in the period of 2011–17 from 2.2% in the previous period. Australia’s economic resilience, strategic business location, increased global trade and investment ties, sound governance and political stability continue to position Australia as an attractive investment destination.

Australia was the eighth largest recipient of FDI inflows in the world in 2017, up from the ninth position in 2016. The total value of Australia’s FDI inflows stood at US$46.4 billion in 2017, marginally down 2.9% from the inflows in 2016. Global FDI inflows fell by 23% in 2017 to US$1.43 trillion from US$1.87 trillion in 2016.    (source: Austrade)

Invest in Australia Further Research

Accrutus Capital has provided this quick summary of important information to help your decision when investing and setting up a business in Australia. More detailed information can be found on these Australian Government portals

  1. Tourism Australia http://www.tourism.australia.com/en
  2. Business Innovation and Investment Visa (subclass188) https://www.homeaffairs.gov.au/Trav/Visa-1/188-
  3. Austrade – Doing business in Australia https://www.austrade.gov.au/international
  4. Foreign Investment Review Board http://firb.gov.au/investment/
  5. Australian Taxation Office https://www.ato.gov.au/
  6. Reserve Bank of Australia https://www.rba.gov.au/
  7. Australian Prudential Regulation Authority https://www.apra.gov.au/ 
  8. Fair Work Ombudsman https://www.fairwork.gov.au/find-help-for/visa-holders-and-migrants
  9. Australian Securities and Investment Commission https://www.asic.gov.au/
  10. Superannuation Guarantee https://www.fairwork.gov.au/find-help-for/visa-holders-and-migrants
  11. Australian Consumer and Competition Act https://www.accc.gov.au/
  12. Australian Privacy Act 1988 https://www.oaic.gov.au/privacy-law/privacy-act/
  13. Trade, import and export https://www.australia.gov.au/information-and-services/business-and-industry/trade-import-and-export
  14. Anti-money laundering and Counter Terrorism Act https://www.oaic.gov.au/privacy-law/other-legislation/anti-money-laundering

DISCLAIMER

The disclaimer covers content, comments, responsibility, links, government and local laws, jurisdiction and communication methods. None of the contents on this website or blog should be construed as any kind of advice or recommendation. Nothing in it should be taken to constitute a statement that is intended to influence a person or persons in making a decision regarding any investment or financial product. This website or blog does not purport to be complete, accurate or contain all information which its users may require to make an informed assessment of whether to invest in any Offer listed through Accrutus Capital Pty Ltd.

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