Expertise
Barwon has been investing in Property Finance since 2013 and over this time has provided investors with strong risk adjusted returns in a variety of projects across Australia.
With investment from Australian institutions and wealth management groups, Barwon Property Finance is a leading provider of investment opportunities in the sector.
When evaluating a Property Finance investment, Barwon’s consideration goes far deeper than just the property. Key areas of review also include the Borrower’s:
Experience
Reputation
Alignment
This approach, combined with Barwon’s due diligence and active management, ensures the investments we make are of high credit quality. Our Borrowers comprise some of the leading developers and property owners in Australia and the majority have been involved with Barwon and its people for many years.
We tend not to follow other funders and top-of-cycle markets, and aim to partner with higher quality developers and property owners seeking higher risk adjusted returns. Consequently Barwon is often active in areas of the market where others are not, creating greater value for our investors.
Why Invest
- The non-bank sector has grown significantly in recent years
- Australian credit market is undergoing a significant structural change
- Major Australian banks are losing market share to more competitive and nimble non-bank debt providers
- Opportunity to invest across individual funds offering select debt opportunities or a diversified managed debt fund
- Australia-wide with the majority in or near major metropolitan areas
- Across project life-cycles from land acquisition, through construction, to completed properties
- Choice of registered first-ranking mortgage security or second-ranking mortgage security
- Below 65% loan-to-value ratios (first-ranking mortgage securities)
- Experienced quality sponsors
- Low volatility fixed returns
- Low correlation with other property sectors
Barwon provides investment opportunities across the capital structure; our approach can be summarised as follows:
1st Mortgage
Debt
- Loan-to-Value Limits: Up to 65%
- Range of Returns (IRR): 6.5% p.a. to 10% p.a.
- Range of Durations: 6 months to 3 years.
2nd Mortgage Debt
and Preference Equity
- Loan-to-Value Limits: Up to 75%
- Range of Returns (IRR): 12% p.a. to 20% p.a.
- Range of Durations: 1 to 2 years.
Ordinary
Equity
- Loan-to-Value Limits: To 100%
- Range of Returns (IRR): 20% p.a. plus
- Range of Durations: 2 to 3 years.
In addition to investing across the capital stack, Barwon will also often isolate each stage of the property development lifecycle as a distinct investment opportunity, rather than being present for the complete development journey on a fixed return, with its various risk-profiles:
| Type | Loan-to-Value Limits | Range of Returns (IRR) | Range of Durations |
|---|---|---|---|
| Pre-Construction | Up to 65% | 6.5% p.a. to 10% p.a. | 6 months to 1.5 years. |
| During Construction | Up to 75% | 12% p.a. to 20% p.a. | 1 to 2 years. |
| Post Construction: Residual Stock Trading-Up Repositioning |
Up to 65% Up to 60% Up to 65% |
6.5% p.a. to 9.5% p.a. 6.5% p.a. to 8.5% p.a. 6.5% p.a. to 8.5% p.a. |
6 months to 1.5 years. 1 to 3 years. 1 to 3 years. |
Key People
Jonathon Pullin, as Head of Property Finance, leads the Property Finance team.
Robert Morrison and Peter Conners are also jointly responsible for the overall management of the Barwon Property Finance investment funds.
