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Unikorn St Martins Village Blacktown Development
This Unit Class of the Fund will purchase a shopping centre in Blacktown and look to maximise the potential of the site by demolishing and rebuilding the property, thereby looking to enhance both rental yields and capital growth.
The establishment of this Unit Class will give Investors an opportunity to directly benefit from Unikorn Capital’s experience and participate in a fund managed by the team at Unikorn Capital, the Investment Manager of the Fund.
Unikorn Cashflow Growth
The Unikorn Cashflow Growth Unit Class is seeking to initially invest in high-yield commercial properties in both regional and metropolitan centres throughout Australia. While the objective will be predominantly to generate rental returns from quality tenants, our experience in commercial property investment will also bring to bear value add opportunities through refurbishments and strategic capital investment.
Unikorn Cashflow Mortgage
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Management
Unikorn Capital was created to capitalise on the experience of its directors both in investing in, and construction of, commercial property.
Through a diversified investment approach, where Investors are able to spread their risk amongst different asset classes throughout Australia.
Unikorn Capital Pty Limited is the investment manager of the Unikorn Property Fund.
The Fund is based on the idea of giving everyday investors access to high-quality commercial properties that generate a range of returns that would otherwise be out of reach for them based on the purchase price.
Helen Tarrant, Director
Helen is a successful commercial property investor who has built with her husband a commercial property portfolio of over $10 Million dollars within 5 years.
Through her other business interests apart from the Fund, Helen has been investing and educating clients in commercial property since 2012, building a community of active commercial property investors through both direct investment as well as private investor groups with investments from $500k to $5 Million.
She has sourced over $400 million in commercial property for her clients.
Helen is passionate about changing people’s lives through commercial property investment and has helped numerous students in finding the right commercial property with both security and confidence.
Stephen Johnson, Director
Stephen Johnson was educated at Sydney Grammar in Sydney. He left school in 1987 and completed his pilot license training at Bankstown Airport.
Stephen studied law at Sydney University.
Stephen and his family have been in commercial construction for over half a century, with the family run construction business having built in excess of $500 million worth of commercial and residential buildings, including: 2 security classified buildings for the Navy, a 45,000m2 warehouse for the army, tunnels under roads, hospitals, schools, retirement villages, warehouses, townhouses, shops, and telephone exchanges.
Stephen has been investing in both residential and commercial properties, with a portfolio in excess of $10 million.
Risks
All investments involve varying degrees of risk. While there are many factors that may impact on the performance of any investment, the section below summarises the significant risks that prospective investors should be aware of when investing in the Fund. * Prospective investors should seek professional advice in setting their investment objectives and strategies.
Before investing, prospective investors should consider whether the Fund is a suitable investment, having regard to their personal investment objectives, financial position, particular needs and circumstances. Apart from reading this PDS, Prospective investors should also read the relevant TMD. Prospective investors should also consider and take into account the level of risk with which they are comfortable, the level of returns they require, as well as their frequency and nature and their investment time horizon. Prospective investors should seek professional advice in setting their investment objectives and strategies. The risks described below are not exhaustive and any risk described in this PDS may have a material effect on the performance and value of the Fund. Importantly, prospective investors should note that the value of an investment in the Fund, and any income received by Investors, may rise or fall and, consequently, Investors may suffer losses (including the loss of all of their capital investment in the Fund).
The value of an investment may rise or fall, distributions may or may not be paid and an Investor’s capital may or may not be returned.
The Fund could terminate, or the fees and expenses paid from the assets of the Fund could change. There is also the risk that investing in the Fund may give different results than investing in the underlying assets of the Fund directly because of possible impairment charges in the Fund and the potential consequences of withdrawal by other Investors.
None of the Responsible Entity, the Investment Manager nor any other person or entity guarantees any income or capital return from the Fund.
The success of the Fund is dependent on the Investment Manager identifying suitable properties for the Fund to purchase, then managing those properties effectively to ensure any returns generated are maximised. If the Investment Manager is unable to achieve this, then this may adversely affect the Fund’s returns.
The Fund is a newly formed managed investment scheme with no operating history upon which Investors can evaluate its likely return. There can be no assurance the Fund will achieve any of its investment objectives, or an Investor’s investment objectives.
There is a risk that domestic or international laws or regulations may change, adversely impacting the regulation of the Fund and resulting in additional costs and/or less rigorous regulatory supervision of transactions and the reporting that is performed. Legal risk also includes the risk of losses occurring as a result of legal issues, principally losses arising out of the nonenforceability or non-enforcement of contracts. Non-enforcement may arise from insufficient documentation, insufficient capacity or authority of a counterparty, uncertain legality or unenforceability resulting from bankruptcy or insolvency.
The Fund will incur fees and expenses regardless of whether it is successful. The Fund will pay Investment Management fees, Responsible Entity fees, Trustee fees, administration fees and other fees and expenses whether or not it receives returns. In addition, the Fund will also be required to pay those fees and other expenses whether the funds raised are fully utilised or not. The Fund must therefore ensure that sufficient liquidity is maintained in order to meet these and other expenses. The Responsible Entity and the Investment Manager expect to incur significant costs and expenses in seeking to source, evaluate, structure, negotiate, close, monitor and exit an investment including, but not limited to, financial, legal, technical, regulatory and commercial advisers, engaged to assist the Responsible Entity and the Investment Manager. There can be no assurance that the Fund will be successful in being able to recover these fees and expenses from a successfully closed investment. These amounts may be significant and could have an adverse impact on the return that Investors might otherwise realise.
A downturn in the economy may affect the value or performance of a property held by the Fund
The business conditions for tenants may change adversely, which may result in tenants seeking rental assistance, defaulting on rental payments, abandoning leases, or not renewing leases on expiry. A reduction in rental income received by the Fund may impact the level of distributions it can make and may reduce the value of its assets.
In the day-to-day operations, allowances are made for known capital works and maintenance of the properties. However, unforeseen repairs or capital works may be required, which may reduce the amount of income available for distribution.
The Fund will be primarily investing in property development projects which are subject to risks which can affect the returns available to Investors such as: o the inability to obtain appropriate or sufficient government planning approval to undertake a successful development of a property; Unikorn Property Fund 44 of 72 o cost overruns and costs to complete any construction work may be more than forecast and additional capital may need to be sourced; o completion of buildings under contract could be delayed due to the fault of the developer or other unforeseen events; o development and construction can be subject to external influence over which the Fund has little or no control; o latent conditions identified within a project; o inclement weather; and o material and labour market conditions; and general market conditions deteriorating.
An investment in the Fund should be considered an illiquid investment. While the Investment Manager’s expectation is that the Responsible Entity will be able to provide withdrawal offers, to Investors that have been invested for the Minimum Term, on an annual basis, there is no guarantee that there will be sufficient liquidity for such offers to be made. Property assets tend to be less liquid than other forms of investment and it may take considerable time to sell a property and redeem the Units. Investors in the Fund will only have limited opportunities to withdraw their investment as outlined in section 6.2. In addition, there will not be any established secondary market for Units. This may represent a risk to you in the event that you require the return of your investment more urgently.
There is a risk that unfavourable movements in interest rates may lead to increased interest expenses. This may result in a reduction to the distributions available to Investors, or failure by the Fund to meet interest obligations on its borrowings. Where any fixed rate borrowings reach their maturity, interest rates may have increased and the Investment Manager may not be able to extend or refinance those borrowings at the same fixed rates. This would lead to increased interest costs for the Fund and therefore it may have a negative impact on Investors’ returns.
The Responsible Entity may combine Investors’ money with borrowed money in the Fund and invest the combined amount in a property. This process, known as gearing, magnifies the effect of gains and losses on your investment and is considered more risky than similar investments that are not geared. If property values or rental income fall significantly the Fund may be unable to meet its loan covenants which may result in the sale of Fund assets. In addition to the property risks outlined above, changes to interest rates or lender credit margins impact borrowing costs and ultimately impact the level of income you receive. There is also a risk that the Responsible Entity may not be able to refinance its borrowings when borrowing facilities mature. If this occurs, the Fund may lose value from selling assets in poor market conditions in order to repay the borrowed amount. The Investment Manager’s intended approach is to actively manage the Fund’s borrowings in conjunction with the lenders to help manage this risk.
The Investment Manager is not a related party of the Responsible Entity. The contractual arrangements between the Responsible Entity and the Investment Manager are negotiated at arm’s length between the parties. The Responsible Entity may from time-to-time enter into transactions with related entities. Stephen Johnson, who is a Director of the Investment Manager, is also a director and owner of SJ Constructions International Pty Ltd, which is the builder which will be engaged to construct and project manage the St Martins Village Blacktown project. Gregory Lazarus, the sales agent for the project has worked with clients of Unikorn Capital for some years as a managing agent. The Administration Manager is a related party of the Responsible Entity and is appointed pursuant to an Administration Agreement. While the fee terms of this agreement are considered in line with market rates, this agreement has not been independently reviewed and the Responsible Entity does not guarantee that it is made on arms-length terms. The Responsible Entity may appoint its related parties or related parties of the Investment Manager from time to time to undertake other functions for the Fund, including, for example, the role of property manager. While not the Investment Manager’s intention for the Fund, the Fund may also purchase properties from parties related to the Investment Manager. Such transaction will only be entered into if it is determined by the Responsible Entity that doing so is in the best interests of investors and on “arms-length” terms or otherwise where the Responsible Entity seeks Investor approval prior to entering into such transactions. It is not the responsibility of the Responsible Entity to assess the merits of each investment recommended by the Investment Manager, but rather to review that each investment is contemplated by this PDS and the Fund’s Constitution. The Responsible Entity does not directly manage the properties in which the Fund invests, and this role, where relevant, will be undertaken by the Investment Manager. The Responsible Entity will rely solely on the confirmation of the Investment Manager that the Fund’s investments are made in accordance with the guidelines it has specified in this PDS, as updated from time to time, and that any investment is made on arms’ length terms. Further, the Responsible Entity will not undertake any independent review that this is in fact the case. Accordingly, the Responsible Entity does not guarantee that these transactions will be entered into on arm’s length terms. By investing in the Fund, Investors acknowledge that the Investment Manager is responsible for making investment decisions for the Fund and that the investments entered into by the Fund may not be on arm’s length terms. Investors also acknowledge that they have made their own independent investigations to satisfy themselves of the benefit of becoming an Investor in the Fund.
This is the risk that the valuation of the investments contemplated by the Fund are inaccurate at the time of deciding to invest so that the amount realised on exit is less than would have been expected had the valuation been correct. There is also the risk that where a professional valuer is used who provides an inaccurate valuation, that valuer does not have or no longer has adequate professional indemnity insurance to cover the valuation on which the lender relies.
Various factors might influence the cost of maintaining insurance over the properties, or the extent of cover available. Increased insurance costs, or limits on cover, can have a negative impact on the performance of the Fund. There are also some potential losses that cannot be insured at commercially reasonable rates, or at all, including force majeure events.
There is a risk that force majeure events, such as natural phenomena and terrorist attacks, may affect the properties for which insurance is not available or for which the Fund does not have insurance cover. Should such an event occur, a loss will result which will have a negative impact on the income and capital value of the Fund. Occurrence of these events could also lead to insurance becoming unavailable for such events in the future, or premiums increasing above levels expected by the Investment Manager.
There is a risk that development approval for the Unikorn St Martins Village Blacktown Development project is rejected. In this instance, the Investment Manager will continue to operate the centre in its current format while appealing to the Land and Environmental court (if necessary). Any fees incurred (including legal) in respect to appealing the development decision (if rejected) will be incurred and payable personally by the Investment Manager.
The effect of tax on Investors is complex and the summary in Section 11 of this PDS is general in nature. Investors should seek professional tax advice specific to their own circumstances before investing in the Fund. There is a risk that the Australian federal and state / territory tax laws at the date of publication of this document, including applicable case law and published guidance by the ATO and state / territory revenue authorities, could change and changes can be adverse. Tax and duty considerations taken into account by the Responsible Entity in preparing this PDS are based on current law and the practices of relevant tax and revenue authorities, all of which are subject to change or to differing interpretations. Prospective investors should note that any such change could have retrospective application, resulting in tax and duty consequences different from those taken into account by the Responsible Entity. There can be no assurance that these considerations will ultimately be sustained in the event of challenge by the relevant tax or revenue authorities. Additionally, as the Fund is likely to acquire or hold interests in land (including indirect holdings), duty (including landholder duty, trust acquisition duty and foreign purchaser surcharge duty) may apply on the acquisition of interests in the Fund (including by way of issue, transfer or redemption of Units). The acquirer or holder of the Units is generally primarily liable to pay the duty. This is in addition to any duty that the Fund may incur in acquiring interests in a property or other land interests.
Generally, the more diversified a portfolio, the lower the impact that an adverse event affecting one investment will have on the income or capital value of the portfolio. The Unikorn St Martins Village Blacktown Development Unit Class will own a single property and is not diversified by asset class, geographic location of properties or exposure to different property sectors.
Over time, the Fund may purchase additional properties, and as such contracts will be entered into by the Responsible Entity or a related entity for their acquisition. There is a risk that the acquisition of properties may not settle when expected. This may impact the Fund’s performance.
In the ordinary course of its operations, the Fund may be involved in disputes and possible litigation with tenants or other service providers. There exists a risk that a material or costly dispute or litigation could affect the amount of expected income of the Fund.
The Investment Manager is responsible for providing investment management services to the Fund and for managing the Fund’s investments on a day to day basis. If the Investment Manager fails to do so effectively, then this could negatively affect the Fund’s performance. In particular, there is a risk that the Investment Manager may fail to anticipate movements in the property market, fail to manage the investment risks appropriately or fail to properly execute the Fund’s investment strategy. These factors could have an adverse impact on the financial position and performance of the Fund.
There will be at least three classes of Units issued in the Fund. Whilst all reasonable efforts have been made to ensure that the separate classes of Units issued in the Fund do not affect the other, there can be no guarantee that this will be the case. By way of example, if litigation is commenced against the Responsible Entity in relation to one of the classes of Units, then this could have an adverse impact on Investors in the other classes of Units. In addition, if external administrators were appointed over the Responsible Entity in relation to one of the classes of Units, then this could also impact Investors in the other classes of Units. Finally, if there was a significant tax liability levied on the Responsible Entity in relation to the investments of one of the classes of Units and there were insufficient assets in that class of Units to pay for that liability, then the Responsible Entity may be forced to utilise the assets of other classes of Units to meet that liability. In addition, because of the nature of the Fund, there may be some limited tax blending across the different classes of Units. Importantly, this means that you may be required to pay tax on income from the Fund even though you have not received that income from the Fund. Investors should seek their own independent taxation advice before deciding to invest in the Fund.
Investors should be aware that while the Responsible Entity has implemented technologies, processes, and practices designed to protect its networks, devices, programs, and data (or IT systems), such IT systems may still be subjected to malicious attack, damage, or unauthorised access. Such IT systems may include the storage of information concerning an Investor’s identity, financial interests or other personal details provided to the Responsible Entity in connection with their investment in the Fund. In the event serious harm is a likely outcome of a breach of the Responsible Entity’s IT systems, the Responsible Entity or Investment Manager (as may be required) will notify the affected individuals and recommend steps that ought to be taken in response to the breach. The Responsible Entity may also be required to notify any regulatory authority as required by law.
Market risk is a generic term to describe the risk factors affecting the securities markets generally that could adversely affect the value of investments in the Fund. These factors include inflation rate increases, real or perceived unfavourable market conditions, investor behaviour, economic cycles and climate, movements in interest rates and foreign exchange rates, changes in domestic and international economic conditions which generally affect business earnings, political and natural events and changes in governments monetary policies, taxation and other laws and regulations.
Changes in laws, or their interpretation, including taxation and corporate regulatory laws, practice and policy could have a negative impact on the operation of the Fund and returns to Investors.
There is a risk of loss resulting from inadequate or failed internal processes, people and systems, or from external events. Adverse impacts may arise internally through human error, technology, or infrastructure changes, or through external events such as third party failures or crisis events. The Responsible Entity has procedures in place to manage these risks and, as much as possible, monitor the controls within these procedures to ensure operational risks are adequately managed.
It is important to note that not all risks can be foreseen. It is therefore not possible for the Investment Manager to protect the value of the Fund’s investment from all risks. Investors should ensure they obtain appropriate professional advice regarding the suitability of an investment in the Fund having regard to their individual circumstances, including investment objectives, their level of borrowings, their financial situation and individual needs. Whilst the Responsible Entity and Investment Manager have taken steps to ensure that the information presented in this PDS is correct, it is possible that due to factors such as the passage of time or the uncertainty in forecast details that the information contained in this PDS may be inaccurate at a later time. The performance of this investment, the repayment of capital or of any particular rate of return, is not guaranteed by the Responsible Entity, the Investment Manager, their directors or their associates. We strongly recommend that Investors obtain independent financial advice before investing in the Fund.
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Disclaimer
The Unikorn Property Fund is a retail managed investment scheme in the form of an Australian unit trust.
Vasco Responsible Entity Services Limited ACN 160 969 120 (Vasco) is the Responsible Entity of the Fund.
Vasco has appointed Unikorn Capital Pty Limited ACN (645 627 621) as the Investment Manager of the Fund.
The Investment Manager is a corporate authorised representative (No. 001284614) of DHF Investment Managers Pty Ltd ACN 607 120 570 AFSL 509932 (DHFIM).
The Investment Manager’s authority under its Corporate Authorised Representative Agreement with DHFIM is limited to general advice regarding the Fund only.
Any other advice provided is not provided pursuant to this agreement.
Vasco Responsible Entity Services Limited ACN 160 969 120 AFSL 434533 (RE) is the responsible entity of the Fund and the issuer of its product disclosure statement (PDS).
The Product Disclosure Statement and Target Market Determination for the product is available on the fund Vasco’s website at https://vascofm.com.
You should consider the Product Disclosure Statement and Target Market Determination in deciding whether to acquire or continue to hold the product.
This website contains information about the potential issue of interests in the Fund, but it is not intended to be used by any other persons in any other jurisdiction if and to the extent that to do so would be in breach of Australian laws, or the laws of any foreign jurisdiction.
This website contains general information only and is not intended to provide any person with personal financial product advice. It does not take into account any person’s (or class of persons) investment objectives, financial situation, or particular needs, and should not be used as the basis for making an investment in the Fund.
This website may contain forward-looking statements regarding our intent, belief, or current expectations with respect to market conditions. Due to various risks and uncertainties, actual events or results or the actual performance of the Fund may differ materially from those reflected or contemplated in such forward-looking statements.
Readers are cautioned not to place undue reliance on these forward-looking statements.
You should read the PDS and target market determination for the fund in full to consider whether an investment is appropriate for you.
Neither the Investment Manager – Unikorn Capital Pty Limited ACN (645 627 621), Corporate Authorised Representative No. 001284614 of DHFIM nor the RE guarantee the repayment of capital, the performance of any investment or the rate of return for the Fund. Past performance is not a reliable indicator of future performance.