This article is from the Australian Property Journal archive
E&P Investments Limited (E&PIL) is on the hunt for an “external professional third-party” to replace it as responsible entity of the US Masters Residential Property Fund (URF).
URF, which provide investors exposure to a diversified residential property portfolio in the United States, had its US REIT operating platform externalised over summer, with Brooksville and Cushman & Wakefield subsidiary Pinnacle City Living operating and managing the fund’s portfolio, “with the goal to realise value and return capital to unitholders as quickly and efficiently as possible”.
It also announced $44.1 million in full-year revenue, up by $4.4 million, while EBITDA increased from $4.2 million to $9.7 million. Funds from operations was negative $10.5 million, but an improvement on the negative $17.4 million of 2021.
URF is looking to return capital to shareholders through an asset sales program with a pipeline that is “being built strategically test the submarkets given the elevated interest rates and macroeconomic uncertainty across the US”.
The fund has closed on the sale of three assets for $4.5 million in 2023, and currently has $14.3 million worth of property under contract and $27.6 million on the market or preparing to be listed.
In a separate ASX announcement yesterday, E&PIL said, “Following the finalisation of the joint venture with Brooksville and the externalisation of the Fund’s operating platform on 30 December 2022, E&PIL believes now is an appropriate time to appoint a new RE”.
“The decision aligns with feedback from various investors in the fund as well as the broader E&P Financial Group Limited’s stated strategic objective of exiting from non-core businesses.”
E&PIL said it would only put forward a proposal to unitholders if it is in members’ best interests. If a suitable proposal is secured, a meeting of members will be called to vote where more than 50% is required for the new responsible entity to be chosen.
URF was established by Dixon Advisory, which was penalised $7.2 million by the Federal Court of Victoria in September for failing to act in their clients’ best interest. All 53 occasions between October 2015 and May 2019 related to advice concerning the Dixon Advisory-established ASX-listed US Masters Residential Property Fund (URF) and URF-related products and when to acquire, roll-over or retain interests in the fund.
Dixon Advisory admitted to several allegations on in October 2021, before being placed in voluntary administration in January last year and having its Australian Financial Services license suspended by ASIC.
In December, creditors of Dixon Advisory voted in favour of a deed of company arrangement that would see them net as much as 4.4 cents on the dollar of money owed.
