Sophisticated, high wealth and institutional investors are increasingly displaying an appetite for investment opportunities that offer access to something different to the more usual managed funds and direct investments, says Farrel Meltzer, head of specialist investment firm Wingate Group.
In addition, Mr Meltzer said such investors are looking for alignment of interest and ‘skin in the game’ on the part of those managing their money.
“Gone are the days of investment professionals making money irrespective of whether their investors do or not.
“At Wingate, we are seeing our co-investment partners – who themselves manage very large pools of capital – interested in investments that they can’t access on their own but that will add to their portfolios without materially increasing risk or the burden of management and monitoring.
”Interest in our private investment partnership, Wingate Investment Partners Trust No. 1, which we opened late last year, reflects this demand.
“The Trust was originally created so that our shareholders could reinvest their Wingate Holdings dividends in a vehicle that co-invested alongside our Group and provided access to investments made by the Group.
“This allowed them to shadow the investment opportunities Wingate Group was involved with – something many were seeking to do.
“While such investors may already have a mix of managed funds, direct property and equity investments in their portfolios, Wingate offers them access to exclusive and one-off investments that offer an edge as to performance and risk mitigation.
“For example, the trust has allowed investors to take advantage of proprietary property financing investments, of which Wingate has successfully completed $400 million over the last four years and which have generated returns in excess of 20 percent per annum.
“The original offer for the Trust was significantly oversubscribed and in June this year, when we re-opened the trust to co-investors, the offer was again heavily over-subscribed, suggesting an ongoing demand for such opportunities.
“We are seeing continuing high levels of demand from co-investors for a diversified portfolio of generally high yield investments across several asset classes and sectors that add another dimension to their existing portfolio,” Mr Meltzer said.
Ryan Levin, joint managing director of Wingate’s property business, added that investors in the Trust have benefited from being able to get involved in property investment opportunities that would not otherwise have come their way.
“The Trust has given our clients a seat at the table when it comes to investment opportunities that are generally not available.
“Wingate has now completed over 50 property funding transactions since the global financial crisis, including several residential development facilities, as well as a number of “bridging” arrangements.
“Our co-investors have had a very positive experience with this type of investment and have indicated that they are keen to be further involved in such opportunities in the future,” Mr Levin said.
The Wingate Investment Partners Trust No 1 generally invests in short and medium term opportunities originated by Wingate’s property finance, asset finance and consumer finance divisions. It also invests in cash and other money market investments. The investment decisions are left entirely with Wingate.
“Investors are attracted to this approach as it provides them with preferred access to very special situations. It also removes a considerable time- and, in part, decision-making burden from their plate whilst they remain secure in the knowledge that their risk is being very carefully managed,” Mr Meltzer said.
Mr Meltzer said he believed this transparent yet highly sophisticated approach has a considerable appeal in this age of vanilla and “me too” investments and complex engineered financial products that are difficult to understand even by professional investors.
The Wingate Group is a private investment and advisory firm focused on capital solutions, property and asset management. It was founded in 2003.
Wingate brings together a specialist set of skills and capabilities in the creation of value for advisory clients and investors.
For more information please contact:
Farrel Meltzer – Phone: +61 3 9913 0701
Ryan Levin – Phone: +61 3 9913 0703
10 September 2013