DomaCom positions for gearing product suite

11-Oct-2017

By Megan Tran

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Fractional property investment company DomaCom is in the final stages of implementing the required legal infrastructure that will allow its sub-funds to hold debt.

The move comes in response to investor feedback and will facilitate the creation of a range of new products that will enable DomaCom to create growth opportunities by leveraging residential property.

To facilitate the transition, the company has selected Melbourne Securities Corporation (MSC) as its new responsible entity to replace Perpetual, which will continue to act as custodian for the DomaCom Fund.

DomaCom chief executive Arthur Naoumidis said the company believed the new product range would be a key driver of future growth given the strong preference from advisers and investors to incorporate debt when investing in property.

“The vast majority of property investors use leverage to improve the growth returns from their investment and we expect this development will substantially grow the portfolio of properties from the current 47 which have been purchased with full equity,” Naoumidis said.

The company said the decision to move to MSC, a firm that specialises in fintech, would enable it to have debt within property sub-funds, which had not been possible over the past two years.

Perpetual will step down as responsible entity at a vote of DomaCom Fund unitholders to be held towards the end of October, with the company anticipating the new lending option to come into effect by the end of the year.

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