Sydney-based investment management firm KSI Investments has completed a land acquisition after raising funds using the DomaCom crowdfunding platform and is accepting investment from SMSF investors.
The firm said it has raised $6.4 million from investors using DomaCom and has transacted on the first two side-by-side parcels of land in the south-west Sydney suburb of Rossmore, five kilometres from the new Badgerys Creek airport and five kilometres from the planned strategic regional centre at Leppington.
DomaCom chief executive Arthur Naoumidis said: “DomaCom is delighted to be involved. We manage an ASIC (Australian Securities and Investments Commission) registered retail managed investment fund under an Australian financial services licence.
“This transaction strongly demonstrates the vision behind the DomaCom platform as we’re helping investors pool money together to purchase quality land assets that would normally be the domain of institutional investors.”
While the first land fund is now closed, the adjoining block of land is open for investment through the second fund. The fund is able to accept investment from SMSF investors as well as private investors, companies and trusts with a minimum investment of $2000.
The fund has acquired 6.23 acres of land on Devonshire Road, which is open for investment. It has also acquired 5.23 acres of land on the same road, which is now closed.
The land is expected to accommodate between 110 to 140 houses if rezoned residential, which is expected to occur over the next five to seven years.
The fund will incur a 2 per cent annual management fee and 20 per cent performance fee at the time of the sale of the land, with an expected time frame of investment of five to seven years with a maximum term of 10 years.
DomaCom offers investors a liquidity facility that enables them to trade units in the fund freely at any time, provided there is a matching buyer and seller before the eventual land sale.
KSI Investments chief executive Robin Luo said: “One of our investors plans to invest in a land fund each year just like he does with wine. He said by investing in one land project each year, after five to seven years he’ll start to enjoy annual realisation of the profits from the maturing land funds, similar to how his wine matures over time and start to enjoy rolling year-on-year returns.”