Hi Everyone... Thought I'd tap the collective wisdom of the board.
A non-profit organisation (ok, My church!) has, conservatively, land assets of $2million, but it's struggling financially. I'd like to see if some of that equity could be accessed to create an income in a way that would pass the muster with a group of fairly risk-averse members. I'm also playing with figures well beyond my experience here, so go easy...
With that sort of equity, even at a reasonably conservative LVR we could borrow 2-3 million, and even just the spread between commercial property returns (say 9.5%) and current fixed 5 year terms (6.2+%) would give a nice five digit income stream... More than enough to fix our budget, and pay into the principal of the debt.
Clearly these have to be +ve cashflow. Even many property trusts would provide that sort of return, and _perhaps_ allow a bigger spread of risk.
Possibly not what the risk-averse membership would probably go for though.
In reality we have much bigger assets in our housing program, and even more in the untapped equity of the combined members. Is there some way to access that in a way that gives some security to the members, but can provide a return?
Or am I dreaming....?
Thanks for your thoughts
Luke
A non-profit organisation (ok, My church!) has, conservatively, land assets of $2million, but it's struggling financially. I'd like to see if some of that equity could be accessed to create an income in a way that would pass the muster with a group of fairly risk-averse members. I'm also playing with figures well beyond my experience here, so go easy...
With that sort of equity, even at a reasonably conservative LVR we could borrow 2-3 million, and even just the spread between commercial property returns (say 9.5%) and current fixed 5 year terms (6.2+%) would give a nice five digit income stream... More than enough to fix our budget, and pay into the principal of the debt.
Clearly these have to be +ve cashflow. Even many property trusts would provide that sort of return, and _perhaps_ allow a bigger spread of risk.
Possibly not what the risk-averse membership would probably go for though.
In reality we have much bigger assets in our housing program, and even more in the untapped equity of the combined members. Is there some way to access that in a way that gives some security to the members, but can provide a return?
Or am I dreaming....?
Thanks for your thoughts
Luke
