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Tim KeithTim Keith May 1 1 min read
Tim Keith

April 2022 Monthly Report

Secure, Stable, High Yielding Investment

Investor capital in the Fund remains well secured.

The current Loan to Security Value (LVR) ratio is 55%. This means for every $1 invested the Fund holds $1.82 in mortgage security.

80% of the Fund’s security is 1st mortgages, with the remaining being 2nd mortgages or other security agreements.

All loans made by the Fund to successful Australian businesses are operating within the approved, legally documented terms and conditions. There have been no arrears or defaults on loans since the inception of the Fund.

Capspace Private Debt Fund investors will continue to receive an interest payment at our target rate of return of 8% per annum for April 2022. This is the 26th month in a row of this high yield for Investors.


Investment Outlook 

The Fund approved new loans totalling $7.5 million in April. Loans were provided for residential property purchase, residential duplex development, and business working capital. This month funds were deployed primarily in NSW.

Capspace Private Debt Fund’s Credit Committee has a cautious risk stance. This reflects the prospect of higher interest rates and stable to softening property prices. Given this economic outlook the committee is ensuring valuations and repayment strategies account for the higher cost of borrowing and slowing in the capital growth of security provided.

The recent CPI reading showed cost of living increases of 5.1% over the last 12 months. We believe that the RBA will starting lifting interest rates as soon as the next meeting on 3 May 2022.

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