Fund in Focus: Freehold Debt Income Fund

Over the last decade Australian banks have been steadily retreating from the real estate lending market. This gap has created an opportunity for private lenders to step in and generate a regular income stream in the form of monthly distributions.

Omar Khan, Portfolio Manager at Freehold Investment Management, says the firm is particularly attracted to the mid-market where typical deal sizes range from $10m - $70m. Khan explains that this segment offers outsized returns without sacrificing the quality that is typically associated with institutional-grade deal quality.

Since inception, the Freehold Debt Income Fund has delivered an 8.63% annual net return with distributions paid monthly. In this Fund in Focus, Khan  provides an overview of the opportunity in this asset class, the strategy and a case study that demonstrates how Freehold generates a regular income stream for investors.

Key points covered:

• APRA regulation has resulted in major banks retreating from the real estate lending market
• This has left a funding gap and created an opportunity for non-bank lenders like Freehold Investment Management
• Freehold focuses on the mid-market which is under-serviced by the banks and offers an attractive risk-reward opportunity
• Case Study: An opportunity in North West Sydney
• An overview of performance and returns from the Freehold Debt Income Fund

Focus on capital preservation and regular income