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First Australia-wide Indigenous Real Estate Investment Trust Established

Indigenous Business Australia (IBA) today announced a ground-breaking initiative to assist and enhance Aboriginal and Torres Strait Islander self-management and self-sufficiency.

The Indigenous – Real Estate Investment Trust (I-REIT) is an innovative product that offers Indigenous investors access to a diversified commercial property portfolio with long-term stable financial returns.

Commencing this month, the I-REIT furthers the Government aim of advancing the commercial and economic interests of Aboriginal and Torres Strait Islander people by enabling asset accumulation and wealth generation.

IBA’s research indicates that the existing Indigenous investment market is large and growing with Indigenous investors looking for new ways to invest alongside trusted and aligned partners.

For more than a decade, IBA has been successfully investing, alongside Indigenous investors, in commercial property and has a strong portfolio of seed assets that will form part of the initial Trust.

IBA Chair Dr Dawn Casey believes that the I-REIT is an exciting new initiative that is aligned with our core statutory purpose; to assist and enhance Aboriginal and Torres Strait Islander self-management and economic self-sufficiency.

“The I-REIT will be seeded with an initial portfolio of commercial properties in which IBA and its Indigenous co-investors hold interests.”

“Over time, IBA and its co-investors will seek to grow the portfolio through acquisitions of quality assets in regional locations that meet the Fund’s investment guidelines, including a target yield of at least 8% per annum across the portfolio,” Dr Casey said.

Further investment in the I-REIT is anticipated in due course to be made available to eligible Aboriginal and Torres Strait Islander organisations investing at least $500,000.

The Government expects more Indigenous groups will be able to invest in the I-REIT than would be possible if they were investing directly in the commercial property market.

There has already been a strong level of interest from Indigenous investors with Gundjeihmi Aboriginal Corporation (GAC), Groote Eylandt and Bickerton Island Enterprises Aboriginal Corporation (GEBIE), Wunan Foundation and Yarnteen Corporation participating in the I-REIT.

GEBIE CEO Greg Mitchell sees the I-REIT as developing sustainable and mutually-beneficial partnerships between Indigenous Corporations.

“Having a foundation involvement in Scarborough House, the chance to grow and diversify our economic portfolio across a broad range of properties has been welcomed by the GEBIE Board of Directors.

“The support and cooperation we have received from of our partner indigenous corporations and IBA has been invaluable to us and is a platform for exploring more opportunities together in the future,” Mr Mitchel said.

GAC’s Chief Executive Officer, Mr Justin O’Brien, said the cooperation of Indigenous investors and IBA has proved a successful investment partnership to date.

“The Mirarr welcome the opportunity to diversify the asset pool through the I-REIT structure.”

Yarnteen CEO Saretta Fielding said the directors are excited to be a pioneering investor in the I-REIT.

“We see this investment initiative as a key to providing Indigenous Australians tangible tools in advancement towards sustainable futures rich in opportunities for our people.

“We greatly value our long standing relationship with IBA and look to our future partnership with optimism and anticipation,” Ms Fielding said.

Wunan CEO Nick Thomas sees the launch of the I-REIT as a very positive initiative for Indigenous organisations.

“Our initial investment with IBA in Scarborough House in Canberra has performed well and the I-REIT provides a more diversified vehicle for future investment.

“This is of great value to us as it is unlikely we would find similar opportunities by going it alone,” Mr Thomas said.

An investment committee, comprising leading senior executives from the investment banking and property sector, Indigenous representatives and IBA senior management, will direct the Fund.

CBRE Australia, a leading national property manager, has been engaged as manager of the portfolio.

 

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