Pallas High Yield Fund No.3
Target Return
5.70% + BBSW
Minimum
$100,000
Term
Open-ended
Executive Summary
The Pallas High Yield Fund No.3 is an open-ended Australian wholesale unit trust investing in commercial real estate debt and select preferential equity, secured by property in Australia and New Zealand. Income is paid monthly at 5.70% per annum above 30 Day BBSW, plus a 5.0% per annum top-up after each financial year. Per the Information Memorandum (August 2024) that gave 15.01% per annum, net of fees and before tax, assuming no change in the Benchmark at that date. Returns and distributions are not guaranteed. Wholesale Investors only, minimum $100,000.
Investment Highlights
- Monthly coupon at 5.70% per annum above 30 Day BBSW, plus a 5.0% per annum top-up paid after each financial year. Per the Information Memorandum (August 2024), 15.01% per annum overall, net of fees and before tax, assuming no change in the Benchmark at that date. Not guaranteed.
- A warehouse facility investing substantially all of its assets in Pallas-managed lending vehicles, which provide first and second mortgage debt and select preferential equity secured by Australian and New Zealand property.
- Portfolio limits: unregistered second mortgage and preferential equity investments to 40%, New Zealand security to 20%, single investment to 33%, weighted portfolio LVR to 77.5%. These take effect nine months after the first investment.
- Illiquid, with no automatic right to withdraw. Redemption needs 12 months notice and an 18 month minimum term, is capped at 5% of net asset value each quarter, and the Trustee may defer or suspend it.
- No fees to investors. The Fund Manager is instead paid the fund's residual net income as a net interest margin, and Pallas entities receive fees from borrowers.
- The fund invests in vehicles managed by Pallas and may deal with related parties of the Fund Manager and Trustee.
- Pallas Capital track record to August 2024: over 680 transactions, $4.8 billion cumulative value, $2.6 billion of investor capital repaid with no loss of principal. Past performance is not indicative of future performance.
- Issued by Pallas Funds Pty. Limited (AFSL 473475) as trustee, with Pallas Capital Pty. Limited as fund manager.
- Wholesale Investors only, minimum $100,000. No cooling off rights. The fund is an unregistered managed investment scheme.
Source: Pallas High Yield Fund No.3 Information Memorandum (August 2024).
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Licence Notice: Managed Investment Scheme (AFSL 416956)
This is general advice only. Content relating to this managed investment scheme is prepared by Figure 8 Capital Pty Ltd ABN 49 681 113 100 (operating Investing Platform), a Corporate Authorised Representative (No. 001311723) of Alpha Node Advisors Pty Ltd (ACN 154 320 000, AFSL 416956), and is available exclusively to wholesale clients and sophisticated investors within the meaning of sections 761G and 761GA of the Corporations Act 2001 (Cth). Investing Platform receives an upfront fee from the issuer on amounts invested, as well as an ongoing fee for the duration of your investment. These fees are paid by the issuer and are not charged to you directly. Read the Website Disclaimer for the full dual-licence explanation.