Barwon Property Finance – First Mortgage Fund update – September 2022

Dec 1, 2022

Nina: Hi, I’m Nina Dunn and welcome to Barwon Property Finance quarterly update. We wanted to take this opportunity to give your a brief update on our flagship property finance fund, the Barwon First Mortgage Fund.

Today we’re joined by Jonathon Pullin, who is a partner and leads the Barwon Property Finance division.

Hi Jono, for those not familiar with the Barwon First Mortgage Fund, can you provide a quick overview?

Jonathon: Thanks Nina – Barwon has been investing in the space for close to 10 years, and we’ve built out a diverse portfolio of 1st mortgage positions across Australia, with what we feel is some of the highest quality non-bank credit in the market, with well capitalised and experienced borrowers.

Nina: Jono, can you talk about the performance of the Fund?

Jonathon: The Fund has returned just over 7. % pa net of fees over the past 12 months, and 8.3%pa net of fees since inception which is within our target return band.

Nina: In terms of current exposures and recent transactions, what can you tell us?

Jonathon: As at September month-end, the portfolio currently consists of:

  1. 21 First Mortgage debt investments,
  2. Has well capitalised and experienced borrowers,
  3. Geographically diversified across Australia,
  4. And has an average weighted loan to value ratio of approximately 60%

Nina: Great, thanks Jono, what’s the outlook for the Fund?

Jonathon: Well Nina, the outlook for the fund is positive. The market is currently going through a lot of change with the rise in the RBA cash rate and a period of increased inflation.  This is leading to higher quality credit scenarios which are normally funded by major banks, making their way through to our environment.Over the past few months and looking forward, we have been able to secure loans at slightly higher returns, and also include a floating rate component, to enable us to benefit from further rate rises.More recently, we have been successful as securing facilities at lower loan to value ratios, for example, a facility we settled last week was at a 42% LVR and we have just secured another debt facility which is below a 50% LVR.

Nina: Thanks for the update Jono. For any investors looking to invest in Barwon First Mortgage Fund, please don’t hesitate to get in touch with the distribution team here at Barwon. Thank you

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