Sterling Investments

Sterling Invest Listed Property Portfolio

Investment Overview

Investment minimum: R 500 000

Portfolio: Sterling Invest JSE Listed Property

Investment manager: Sterling Invest

Stockbroker: SAXO/DMA (www.dma.co.za)

Underlying portfolio: Shares in 8 to 10 JSE listed property companies

Targeted long-term annual returns net of fees (5 years+):

Income return: 7% per annum

Capital growth return: 5% per annum

Total expected return: 12% per annum

Fees (Inclusive of VAT):

Portfolio Manager fee: 1.15% per annum (payable to Sterling Invest)

Platform/Custody fee: 0.08625% per annum (payable to SAXO/DMA)

0.40% once-off stock brokerage fees (payable to SAXO/DMA)

Targeted long-term annual returns net of fees (5 years+)

Reasons why you should invest in SA Listed Property

1.High quality underlying property portfolio

• Own the best properties in the best locations.
• Blue-chip properties with real blue-chip tenants.
• Approx. 40% of JSE Listed Property revenues is derived outside SA (rand hedge).

2.Attractive risk-return profile

• The expected annual income return of our high-quality property portfolio is currently around 7% per annum.
• Conservatively, we expect annual capital growth of the portfolio to at least keep up with forecast inflation over the long term (5% per annum).

3.Easy Liquidity

• Access your money within 3 – 5 days.
• There’s no lock-in periods or waiting for buyers to replace you.
• You decide what to do with your income earned (get it paid out monthly, quarterly, annually or choose to reinvest all or part of it).

4.Widely diversified

• Get exposure to effectively thousands of underlying properties.
• Across geographies (local, offshore), across sectors (retail, commercial, office, specialised).
• Across management teams (we invest in 8-10 different underlying property companies who each have their own, highly competent management teams).

5.Tax efficient

• Pay substantially less tax by housing your share portfolio within highly tax-efficient structures like endowments, living annuities and retirement annuities.
• Most listed property companies in SA operate as REIT’s (Real Estate Investment Trusts) which could result in tax savings for you, the end investor.

6.Investments are highly regulated

• Sterling Invest and SAXO/DMA (our stockbroking partner) undergo rigorous monthly FSCA (FSB) compliance audits.
• Companies we invest in have to comply with JSE Listing and Reporting Requirements, strict internal control measure and corporate governance procedures.
• Co-invest with big, institutional investors (pension funds, unit trust funds).

7.Professionally managed

• Our portfolios are a culmination of a robust investment process, carefully selected by investment professionals, using the Sterling Invest Alpha Process
• The property companies we invest in are led by arguably the brightest, most experienced and qualified people in the property sector

8.Fully transparent

• The underlying fees charged are easy to understand
• You receive quarterly portfolio statements by email so you can track performance
• Property companies report results publicly bi-annually with detailed & transparent disclosure of their underlying property portfolio’s performance

9.Completely passive

• There’s absolutely nothing for you to do but sit back, stay invested for the long term and collect your returns

Why Listed Property is superior to owning Direct Property

  • Troublesome and unreliable tenants
  • The dreaded untenanted property
  • Difficult lease negotiations in a challenging economic environment
  • The ongoing maintenance headache (plumbing, painting, repairs etc)
  • Rising property holding costs (insurance, rates, levies, electricity, management fees)
  • Exorbitant purchase and sale costs which heavily dilute investor returns (agents fees, transfer duties, conveyancing fees etc)

Why Listed Property is superior to privately managed Property Syndications

  • Superior quality of the underlying property portfolio
  • Access your investment monies without any restrictions
  • Far broader diversification within a single investment portfolio
  • Ability to access tax-efficient investment structures
  • Greater transparency, independence, regulatory oversight and attention to corporate governance
  • Highly experienced & qualified professional management teams

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