Folkestone Real Estate Income Fund at Altona North

Fund Overview

The Folkestone Real Estate Income Fund at Altona North (Fund) is a single asset, closed end unlisted real estate fund .

The Fund owns a a large format retail centre at 330 Millers Rd, Altona North, Victoria (Millers Junction Home). Millers Junction Home has been leased to leading retailers including Bunnings, Officeworks and JB Hi-Fi Home.

The Fund aims to provide Unitholders with sustainable, tax effective income and the potential for capital growth through active management of the Centre.

The Fund’s term is six years to November 2020 unless Unitholders agree to a variation of the Fund term.

Fund Type The Fund is a single asset, closed end unlisted real estate fund.
Investment Strategy The Fund owns a large format retail centre at 330 Millers Road, Altona North, Victoria.
The Fund is forecast to provide:
1: Annualised distribution yield of 8.75 per cent in FY17; and
2: The potential for capital growth through active asset management and improving retail market fundamentals.

Key Financial Information

Distributions Forecast distribution yield to Unitholders is 8.75 per cent in FY17*.
Distribution Payments Quarterly
Tax Deferred Distributions Distributions are anticipated to include a tax deferred component. The distribution for FY17 is forecast to be 64.5 per cent tax deferred.
NTA The Fund’s NTA value per unit as at 30 June 2016 was $1.37. Excluding the negative impact of accounting for the hedging the Fund has in place, the Fund’s NTA value per unit increases to $1.44.
Gearing The Fund gearing ratio at 30 June 2016 is 38.7 per cent. The Fund will target gearing of no more than 50.0 per cent through the term of the Fund.
* Based on the Issue price of $1.00 per Unit. Distributions are not guaranteed. For further information, please refer to the PDS.

Our Board – Folkestone Funds Management Limited

Grant Hodgetts
Non-Executive Chairman
BA, Assoc Dip Val, AAPI, MACID
Greg Paramor AO
Managing Director
FAPI, FAICD, FRICS
Ross Strang
Non-Executive Director
LLB (HONS), MAICD
Adrian Harrington
Head of Funds Management
B.SC (HONS), FFINSA

Our Executives – Folkestone Funds Management Limited

Greg Paramor AO
Managing Director
FAPI, FAICD, FRICS
Adrian Harrington
Head of Funds Management
B.SC (HONS), FFINSA
Ben Dodwell
Head of Real Estate
BA (I.D.), Grad. Dip. App. Fin. SIA, DIP PROP FIN, MAICD
Travis Butcher
Chief Financial Officer – Funds
B.Acc, CA, Grad. Dip. AFI SIA
Scott Martin
Chief Financial Officer & Company Secretary
B.Com, CA
Mark Stewien
General Counsel
LL.B, BCom (Finance)

Asset Overview

Asset Millers Junction Home, Altona North, Victoria.
Sector Large Format Retail
Gross Lettable Area Retail 22,016 square metres
Rationale for Acquisition Folkestone has selected the Centre for the following reasons:
1: strategic location – located on a major arterial road in inner west Melbourne and within a strong retail catchment area;
2: new asset – the Centre, which is designed as a modern functional large format retail centre, was fully opened in late September 2014;
3: strong lease covenants – Bunnings and Officeworks (part of Wesfarmers) contribute approximately 74.0 per cent of the Centre’s income plus a further 24.4 per cent is sourced from JB Hi-Fi Home, Repco, PETstock and petVET;
4: long-term leases – the weighted average lease expiry profile by income is 8.8 years and by area is 9.4 years as at 30 June 2016;
5: limited competition – there is limited competition from other large formal retail centres in the Centre’s main trade area.

Location

Altona North is located approximately 13 kilometres west of the Melbourne Central Business District (CBD). Altona North forms part of the City of Hobsons Bay located at the north western end of Port Phillip Bay. HobsonsBay covers the suburbs of Altona, Altona Meadows, Altona North, Brooklyn, Laverton, Newport, Seabrook,Seaholme, South Kingsville, Spotswood,Williamstown and Williamstown North. Hobsons Bay covers 66 square kilometres at the northern end of Port Phillip Bay and south west of central Melbourne. Hobsons Bay is located next to two of the fastest growing municipalities in Victoria: the City of Wyndham and the City of Melton. Hobsons Bay is in the Western Metropolitan Region and has over 20 kilometres of beaches and foreshore areas.

Hobsons Bay has good access to regional transport facilities such as the West Gate Freeway, the Western Ring Road and the National Rail Line as well as linkages to the ports and Melbourne and Avalon airports. The surrounding area to the Centre has a mix of retail, commercial, industrial and residential property. The area is relatively industrialised having a number of major industrial precincts including a Toyota manufacturing plant.

According to MacroPlan Dimasi, there are approximately 110,440 people living within the main trade area (59,010 in the primary sector and 51,540 in the secondary sector).

Millers Road is a major north-west carriageway linking the Westgate Freeway to Altona to the north and Williamstown to the south. The Centre will be located on the western side of Millers Road, between Cabot Drive and Ross Road and will have high visibility and be easily accessible from the surrounding area. According to VicRoads, approximately 22,000 vehicles a day pass the site. Kororoit Creek Road, just south of the Centre runs east-west linking the Princess Highway to the west with Williamstown to the east.

Investor Centre

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Reports & Publications

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Distributions & NTA

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Tax Components

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Frequently Asked Questions

1. How much are my Distributions?

http://folkestone.com.au/altona-north/ Distributions & NTA

2. Where can I find the Fund's NTA unit price?

http://folkestone.com.au/altona-north/ Distributions & NTA

3. How do I invest?

The Fund is a closed end fund not open for new subscriptions.

4 . Is there a Redemption Facility for the Fund?

No redemption facility is available.

5. Can I sell my Units in the Fund?

A Unitholder can transfer Units in the Fund to another person by providing the Responsible Entity with a completed standard transfer form signed by both the transferor and the transferee. The Responsible Entity reserves the right to decline transfer requests in its absolute discretion including when a transfer is not completed correctly, is not stamped or if any one Unitholder would hold more than 20.0 per cent of Units. Tax implications could be associated with the transfer of Units. Unitholders should discuss their circumstances with their professional adviser before requesting a transfer.

6. How much is the distribution?

Forecast annualised distribution for the period 1 July 2016 to 30 June 2017 is forecast to be 8.75% p.a. This distribution is based on the an issue price of $1.00. Distributions are not guaranteed.

7. When are distributions paid?

Distributions are paid quarterly for the periods ending 31 March, 30 June, 30 September and 31 December.

8. How do I have payments paid directly to my bank or building society?

To receive your distribution payments by direct credit into your bank or financial institution account, or to change previously advised account details, you must provide written advice to the Unit Registry. In some cases, this advice can be provided online. Please refer to the Unit Registry for more details.

9. How do I change my investment details (e.g. name, address, method of payment, etc)?

To make changes to your investment details, written advice must be forwarded to the Unit Registry. In some cases, this advice can be provided online. Please refer to the Unit Registry for more details

10. How can I get another copy of my holding statement?

Send your written request for a duplicate statement to the Unit Registry. Please include the following information:

– Full name of the registered Unitholder, Unitholder Number, Name of the Issuer, the registered address of the Unitholder, Number of units held and the Signature of the registered Unitholder.

Please note that a charge may be levied for this service.

11. How can I give notification of my Tax File Number (TFN)?

Advice of TFNs can be given in writing to the Unit Registry or lodged online via the Unit Registry’s website. You can download a TFN notification form from the Unit Registry’s website. You may choose not to provide your TFN, however if you do not provide your TFN your distribution will be taxed at the highest marginal rate.

12. When will I receive updates on my investment?

If you invest directly into the Fund, and not via an IDPS, master trust or wrap account, the Responsible Entity will provide you with a:

– Confirmation Statement – specifying details relating to your investment or redemption; Regular Reporting – a quarterly report updating the Fund’s operations and updates on major activities about the Fund;

– Distribution Statement – a quarterly distribution statement detailing the distribution amount, payment date;

– Annual Report and Audited Accounts – an annual report and audited accounts for each 12 month period ending 30 June; and

– Tax Statement – an annual tax statement setting out the Fund’s tax position each year.

The regular reporting including the Annual Reports and Audited Accounts will be available on Folkestone’s website (www.folkestone.com.au/) and will be sent electronically to you if you have elected to receive it via email. Hard copies of these reports will not be sent out unless you have requested on the Application Form or in writing to us.

13. Where can I get an Annual Report for The Fund?

Go to the Reports and Publications section of this website where they are available in electronic format

14. How can I choose to receive or no longer receive the Annual Report?

This can be requested by writing to the Unit Registry.

15. How do I contact the Unit Registry?

The Unit Registry’s contact details are as follows:

Boardroom Pty Limited
GPO Box 3993, Sydney NSW 2001
Telephone: 1300 737 760
Facsimile: 1300 653 459

Email: enquiries@boardroomlimited.com.au
Website: http://www.boardroomlimited.au/

16. When will I receive my annual tax statement?

A tax statement for the tax year to 30 June is mailed to all Unitholders who have held an investment in the Fund during that financial year. The tax statements are typically mailed out six to eight weeks after 30 June each year.

The tax statement summarises the distributions paid during the year and includes information required to complete your annual tax return such as the tax advantaged component of the distribution.

17. Does the Fund hold an Annual General Meeting?

The Fund is not required to hold an Annual General Meeting unless it chooses to do so.

18. How do I contact the Manager?

Go to the Contact Us component of this web page or use the details below:

Folkestone Funds Management Limited
Level 14, 357 Collins Street, Melbourne, Vic 3000

Telephone: +61 3 9046 9946
Fax: +61 3 9046 9999

19. How can I log on to view information of my holding in the Fund?

Please visit: https://www.boardroomlimited.com.au – InvestorServe

20. Do I have to tell you when I change financial advisers?

You are not obliged to advise us when you change financial advisers, however to ensure that your adviser is able to obtain information regarding your investment, it is best that you do notify us.

A letter confirming your new adviser’s details, signed by all security holders should be sent to the Unit Registry.

21. How should I deal with a deceased estate?

To change the holding into the name of the estate a certified copy of the death certificate and will or probate (if required) will need to be sent to Investor Services to be noted on the register.

Please contact our Unit Registry for further information on administering a deceased estate.

22. Forms

The following forms are available at: http://www.boardroomlimited.com.au/Forms.html

Annual Report Election

Change of Address

Direct Credit Authority

Non Market Transfer – Unlisted Funds and Structured Products

TFN, ABN or Exemption Notification

23. Disclaimer

The information contained on this webpage is of a general nature only and does not constitute financial product advice. This webpage has been prepared without taking account of any person’s objectives, financial situation or needs. Because of that, each person should, before acting on this webpage, consider its appropriateness, having regard to their own objectives, financial situation and needs. You should consult a professional investment adviser before making any decision regarding a financial product. This is not an offer to invest in the Folkestone Real Estate Income Fund at Wollongong. Investment in the Fund can only be made by completing the application form for the Fund within the Fund’s Product Disclosure Statement (PDS). None of FLK, FFM or any of their respective associates, related entities or directors guarantee the performance of the Fund or the repayment of monies invested.

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