ResiBonds property development for small, medium and large-scale, real estate projects such as high-rise, land acquisition and sub-division and townhouse developments in major Australian locations from Brisbane to Perth. Issued by the developer, builder or renovator. For investors ResiBonds property generally deliver higher returns of around 10% ++ per annum or more compared to the low returns investors are getting from bank term deposits. These are short-term investments of between 12 to 36 months. Residential investment bonds are a type of hybrid security that developers, builders or renovators can issue to raise capital from investors to fund a small-scale residential development project. ResiBond property Bond is a written promise, legally enforceable; to pay on demand, or on one or more specified dates, a specified sum. The note sets forth the terms and conditions of the loan arrangement between the individual or issuing company and the investor. ResiBonds property funding is primarily a debt instrument, but can be converted into bricks & mortar at the discretion of the investor. This enables astute investors to acquire an (ResiShare) interest in a property at wholesale rates. Small private proprietary companies can use ResiBonds property funding to raise amounts from $100,000 up to $5,000,000. An independent party (stakeholder) holds investor’s funds in trust until milestones and time-related Payment Claims are called upon as set out in the Building Contract. The contractor submits a Payment Claim to the stakeholder for each milestone payment. Practical completion is when the works are completed in accordance with the Building Contract and all relevant statutory requirements have been met (with the exception of minor defects or minor omissions).
ResiBonds property stakeholders:
- The Master Builders Association – Holding Account;
- A Real Estate Agent’s Trust Account;
- The investors’ solicitor’s Trust Account.
Note: As well as being used as a security account, stakeholder’s accounts are also used in case there is a monetary dispute between parties where a building contract is in place. The primary purpose of these accounts is to hold the disputed amount of money in trust until the matters are resolved. The unlisted public company structure is a more suited structure for undertaking larger projects requiring from $1 million and up to $5 million or more. Redemption: Interest is paid either monthly, quarterly, annually or cumulative to investors with a maturity date that dictates when the principal will be paid back in full (redeemed) together with any interest accrued (usually at project’s end) or, part or all of the ResiBonds property Bond (plus any accrued interest) may be converted into bricks & mortar real estate ResiShare ownership on title (as a tenant-in-common) at the option of the investor(s).
ResiBonds Property Funding
- Once the proceeds of (retail) sale of the finished project have been received, or;
- Bank financing has been received, or;
- The lenders agree to convert their ResiBonds into bricks & mortar
ResiBond property investment can provide a way for people to get a foothold on the property ladder at wholesale rates by converting the loan plus any accrued interest into ResiShare bricks & mortar, and if converted into bricks & mortar, waive any obligation of the borrower to repay the principal and any accumulated interest. ResiBond property holders are often protected by a series of covenants such as a negative pledge, restrictions of indebtedness and gearing covenants and in a period of insolvency are entitled to recover unpaid principal and interest. In Australia companies can raise capital via a compliant offer under Section 708 of the Corporations Act 2001; as a small-scale offer which significantly reduces the high cost of preparing a corporate bond issue and listing on a national stock exchange.
To enquire about Accrutus Capital raising division and how to use ResiShare and ResiBonds Property, call us +61 2 9006 1327