How to Start Investing in Commercial Real Estate

Start investing in commercial real estate with managed funds

Commercial property has long been regarded as a popular investment in Australia, with many investors drawn to its rental yields and income-producing potential.

However, with high-quality commercial properties typically priced in excess of $5 million, investing in commercial real estate directly is rarely an option for the individual investor.

This is why many choose to start investing in commercial property through syndicated investments known as property funds.

Westbridge Funds Management has been helping investors grow their wealth through commercial property funds for more than 20 years.

Our funds provide investors with access to high-quality commercial properties offering regular income returns and potential for capital growth from as little as $50,000.

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How property funds work

A commercial property fund is a form of pooled investment whereby investors purchase a share of a commercial property (or properties) that are held in a separate structure, usually a unit trust.

The fund, along with all aspects of acquiring and managing the assets within it, is professionally managed by a team of property investment experts.

Investors usually receive passive income distributions – typically monthly – from the fund relative to their unit holding (i.e. how much they have invested), as well as their portion of any capital growth realised at the end of the fund.

There can be several potential advantages to the fund structure:

Lower capital outlay

Due to their syndicated structure, funds can enable investors to start investing in commercial property at a significantly lower capital outlay than investing alone. As a guide, minimum investments in our property funds at Westbridge Funds Management begin at $50,000.

Passive returns

With managed property funds, everything from the acquisition of the fund’s assets to the ongoing management and fund administration is overseen by the fund manager. This can open up a broader range of investment opportunities through the fund manager’s industry network and expertise, while enabling investors to enjoy a passive approach to their investments.

Diversification

With lower capital requirements, managed funds can enable investors to spread capital across multiple different funds and investments, rather than concentrating all capital on a single asset. This can in turn help to reduce risk by enabling greater opportunity for diversification.

Access to high-quality tenants

In enabling investors to pool their capital, property funds can allow the purchase of larger-scale assets, often leased to reputable blue-chip tenants. The tenants in our funds at Westbridge Funds Management range from national and ASX-listed brands, to local retailers such as specialist medical tenants.

Non-recourse debt

When investing in property funds, all borrowings are entered into by the fund and not by the individual investor. This means that unit holders won’t be subject to personal guarantees (i.e. they won’t be required to provide any bank security, such as their home or other assets) and are not liable beyond the cost of their own units. For this reason, property funds can be popular as an investment option for self-managed super funds, which do not allow for recourse lending.

Investing with Westbridge Funds Management

At Westbridge Funds Management, we’ve been helping investors grow their wealth through commercial property funds for over 20 years.

Our funds provide investors with access to a broad range of opportunities, from commercial properties with a value-add focus, to multi-asset portfolios designed to provide our clients with regular, long-term income.

All our funds are underpinned by our investor-first approach. We believe that transparency and communication are critical in delivering a better experience for our clients.

Our Latest Commercial Property Funds

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