Services and Fees

Services and Fees2018-11-22T11:40:36+00:00

Investment management

URF Investment Management Pty Limited (a subsidiary of Evans Dixon Limited) is the Investment Manager of the Fund (Investment Manager).

The Investment Manager provides investment management services to the Fund, including assessing market conditions and investment opportunities, selecting and recommending properties for investment, monitoring the Fund’s property portfolio, and determining and recommending the sale of properties in the Fund’s portfolio.

Since establishment, the Investment Manager has inspected and modelled nearly 4,000 properties representing some 10,000 housing units in the target area on behalf of the Fund and currently monitors over 1,500 housing units.

For these services, the Investment Manager has agreed to waive the investment management fee payable under the Investment Management Agreement, indefinitely. The Investment Manager will continue to provide all the services set out in the Investment Management Agreement.

Responsible entity and administrative services

Walsh & Company Investments Limited (also a subsidiary of Evans Dixon Limited) is the Responsible Entity of the Fund (Responsible Entity).

The Responsible Entity’s duties include establishing the Fund’s compliance plan and procedures and monitoring against regulatory and legislative requirements, the issuance of disclosure documents, the appointment and monitoring of external service providers to the Fund and overall administration of the Fund.

For these services, the Responsible Entity currently charges a Responsible Entity fee of 0.08% per annum (exclusive of GST) of the gross assets of the Fund and an Administration Fee of 0.25% per annum (exclusive of GST) of the gross assets of the Fund.

Australian Fund Accounting Services Pty Limited (also a subsidiary of Evans Dixon Limited) provides administration and accounting services to the Fund. Time spent by staff is charged to the Fund at agreed rates under a Services Agreement.

Architecture, design, and construction

Dixon Projects, LLC (a subsidiary of Dixon Advisory USA Inc., which is itself a subsidiary of Evans Dixon Limited) provides Architecture, Design, and Construction services to the Fund, including procurement and inventory management, permitting and approval process management and construction project management. Dixon Projects provides on-site project administration and management, overseeing and coordinating all aspects of the construction process, working closely with contractors to control quality and costs for the Fund.

Dixon Projects is a leading premium townhouse renovator in the New York metropolitan area, and its services are integral to value generation for the Fund. Dixon Projects is also committed to the betterment of the neighbourhoods in which it operates. Reflecting this, Dixon Projects was awarded the Preservation Initiative Award by the Jersey City Landmark Preservation Conservancy in 2014 and the Rising Star Award at the New York Construction  Awards in 2015.

For these services, Dixon Projects currently charges market based hourly rates for its architecture and design services and a development fee of 5% of the cost of renovations, which include labour and materials, general conditions, and insurance. These costs are capitalised to the relevant investment properties.

All expenses relating to Dixon Projects, including salaries for all architecture, design, and construction professionals as well as all overheads, are borne by Dixon Projects and are not charged to the Fund.

Leasing

The Investment Manager oversees the provision of tenant leasing services to the Fund, including coordinating marketing campaigns, stagings, showings, administering inquiries, conducting background checks including criminal, eviction, and financial history, evaluating tenant applications, and negotiating and executing leases. These leasing capabilities have enabled it to achieve record rents in several neighbourhoods for the Fund.

For these services, the Investment Manager has agreed to waive the leasing fee payable under the Investment Management Agreement, indefinitely. The Investment Manager will continue to provide all the services set out in the Investment Management Agreement.

Transaction services

The Investment Manager oversees the provision of property acquisition and disposal execution services to the Fund, including property negotiations, conducting due diligence, coordinating title searches, insurance, and third-party reports and inspections, organising all documentation and closing, and coordinating marketing campaigns.

For these services, the Investment Manager currently charges 2.49% of the value of the property for disposals. The Investment Manager has agreed to waive the acquisition fee payable under the Investment Management Agreement, indefinitely. The Investment Manager will continue to provide all the services set out in the Investment Management Agreement.

The Investment Manager oversees the provision of debt arranging services to the Fund, including contacting and liaising with capital providers, negotiating borrowing terms, and executing documentation.

For these services, the Investment Manager currently charges a debt arranging fee of 2% of the amount of debt financing raised.

Reimbursement of expenses

The Responsible Entity and Dixon Advisory USA Inc (a related entity of the Responsible Entity) are entitled, pursuant to the management agreements, to recover certain direct expenses incurred in the management of the Fund’s activities. The expenses recovered from the Fund are primarily in respect of the Fund related payroll expenses, office lease and depreciation recoveries. Certain payroll and overhead expenses that are not recovered from the Fund are borne by Dixon Advisory USA with the intention that such ongoing costs are met out of the Management fees paid by the Fund or US REIT.

Under the Fund’s Constitution a number of the above fees and charges may be changed within certain parameters. Where a fee or change specified in the Constitution was proposed to be changed the Responsible Entity would announce the change before it was implemented.