KC Diversified Income Fund
Keystone is the responsible entity and investment manager of the KC Diversified Income Fund. The KC Diversified Income Fund is a pooled mortgage that allows investors to invest in a diversified portfolio of loans secured by registered first mortgages over real property assets within Australia.
Key Lending parameters
The key lending parameters of the Fund are as follows:
| KEY LENDING PARAMETERS | COMMENT |
|---|---|
| Type of Loan | All Loans will be secured by a registered first mortgage over real property within Australia. |
| Type of Security Property | The Security Property may be any type of real property, including office, retail, industrial, residential, vacant land, construction or development sites, hotels or specialist property. |
| Maximum LVR | The maximum LVR of the Loan as at the date it receives credit committee approval is 70%. For construction or development Loans the 70% LVR is assessed against the “as if complete” market valuation, in all other circumstances the 70% LVR is assessed against the “as is” market valuation. |
| Maximum Exposure to a Single Loan | The Fund’s maximum exposure to any single Loan is the greater of $5,000,000 or 10% of the Fund’s total funds under management as at the date the Loan receives its credit committee approval. |
| Maximum Exposure to a Single Borrower | The Fund’s maximum exposure to any single Borrower (including their related entities) is the greater of $10,000,000 or 20% of the Fund’s total funds under management as at the date the most recent Loan receives its credit committee approval. |
| Maximum Loan Term | Loans must be for an initial period of no more than 24 months. |
| Geography | The primary Security Property may be located in any geographic region of Australia. |
Benefits Of Investing
The benefits of investing in the Fund include the following:
Regular Monthly Income Distributions
The Fund aims to provide Investors with a diversified income-producing portfolio of Loans that delivers regular consistent income and a high degree of capital stability.
Distribution Reinvestment Option
The Fund offers Investors the option to either have their monthly income distributions paid to their nominated bank account or to have their monthly income distributions reinvested in the Fund. The distribution reinvestment option is designed to assist Investors in building the size of their investment portfolio over time.
Investment Alternative
Direct mortgages as an investment class have been around since the start of time. However, for most people gaining access to this type of investment class is problematic. An investment in the Fund provides Investors with access to this asset class and provides an alternative to listed equities, direct property and government and corporate bonds.
Experience And Oversight
Keystone’s board of directors, senior management and credit committee bring together in excess of 170 years of relevant experience in property investment, property development, funds management, banking and commercial mortgage lending.
Fund FAQ’s
Q: How do I become an investor in the KC Diversified Income Fund?
A: Simply complete the Application Form which is contained within our Product Disclosure Statement and send it to us along with your Application Money. To obtain a copy of our Product Disclosure Statement you can either contact us via the “Contact” tab, or you can download it via the “Resources” tab of our website.
Q: What is the minimum investment I can make?
A: The minimum investment in the KC Diversified Income Fund is $25,000.
Q: Will I receive a fixed income distribution return?
A: No, it is intended that distributions will be paid monthly in arrears at a variable rate. Variations in the distribution rate from one month to the next can occur as a result of changes in either the composition of the Funds investment assets, the returns actually received on the Funds investment assets as well as the total funds investment in the Fund.
Q: How liquid is my investment in the Fund and is there a minimum investment term?
A: The KC Diversified Income Fund operates as a non-liquid fund. There is no minimum investment term however withdrawals from the Fund can only be made after a Withdrawal Offer is made. Subject to liquidity, Keystone intends to make quarterly Withdrawal Offers to Eligible Investors.
Q: What does the KC Diversified Income Fund invest in?
A: The Fund will invest in loans secured by first registered mortgages over real property as well as at call or term deposits with ADIs. The Funds exposure to loan investments can be achieved by lending directly to the Borrower or by making an investment in Keystone’s contributory mortgage fund the KC Select Income Fund.
Q: How secure is my investment?
A: Your investment in the Fund is not capital guaranteed however as all loans have been rigorously assessed against Keystone Capital’s credit criteria, approved by Keystone Capital’s Credit Committee and are secured by a first mortgage over either freehold or Crown leasehold land much of the risk of capital loss on your investment is mitigated.
Q: Are there any entry or exit fees?
A: There are no entry or exit fees payable to be an investor in the KC Diversified Income Fund.