The auspv renewable energy strategy, owns fully operational sites located throughout Australia.
All sites are operational and income producing ranging in size from 3MW to 15MW.
The combined 7 year PPAs (Power Purchase Agreements) and LGCs (Large Renewable Generation Certificates) revenues less expenses are expected to generate a return of between 8.65% and 4.4% p.a.
These investments will receive income in the form of monthly distributions in a range of between 4% to 8% pa.
These investments should be considered an income investment.
Industry issues include;
• Cost competitiveness – renewables are the cheapest energy to produce
• Increasing demand – population growth and CO2 targets
• Supply constraints – the retirement of coal fired plants
There are a number of embedded options existing for these sites namely;
• Plug and play battery energy storage
• Inter-regional energy export
• H2 (Hydrogen) production through the use of electrolysers
Battery storage offers an opportunity to add several revenue streams such as network support services, the ability to sell Cap Price contracts to energy users and retailers and energy arbitrage achieved by charging battery storage during low price periods and discharging during high price periods. These opportunities are expected to grow as coal-fired plants cease operation.
Hydrogen production costs are falling each year and this offers sites the opportunity to value add in coming years.
The DomaCom Fund ARSN 167 020 626 is an investment vehicle managed by DomaCom and is an ASIC registered managed investment scheme which issues units in the sub-fund that holds the property. The issuer of this product is Melbourne Securities Corporation Limited AFSL No. 428289. DomaCom Limited holds an Australian Financial Service License (No. 444365) and as the Manager, is responsible for all due diligence.
These auspv sites are presented for investment by DomaCom Limited (ACN 604 384 885). Auspv contract out the operators and DomaCom manages a fractional investment platform enabling investors to participate with other investors in the managed sub-fund.
If you would like to invest in auspv Renewable Energy Mortgage Income Strategy, you can join this crowdfunding campaign by completing the application and lodging your investment funds through this General Advice page. Please ensure that you first read the DomaCom Fund’s Product Disclosure Statement (PDS). For a copy of the current PDS, please click here or call your financial adviser.
When you have lodged your bid and the campaign is filled, you will also receive a Supplementary Product Disclosure Statement (SPDS) outlining the specific offer to invest in the auspv Renewable Energy Mortgage Income Strategy which will contain all the information required for you to make a decision. You are not bound to proceed with your bid amount for this auspv Renewable Energy Mortgage Income Strategy crowdfunding campaign until you accept the offer contained in the SPDS (which will include the specific details for the property you have selected).
If you are new to DomaCom, click on the Apply button to begin your application. If you are an existing DomaCom Fund investor, you can login to access your account and all the other public crowdfunding campaigns by clicking the Investor Login button.
Risks for Property Sub-Funds
Refer to the section 7 of the PDS titled Risks of investing in the DomaCom Fund and the sub section 10.3 of the PDS Risks of Investing in a Loan Sub-Fund such as this sub-fund.
Specific risks of this investment:
- Loan Sub-Fund not established – If there is insufficient Investor interest in the Loan Investment, or if the Borrower is not successful in purchasing the Security Property the Loan Sub-Fund will not be created.
- No guarantee of returns– Returns are not guaranteed and Investors may lose money some or all of their income return and capital.
- Liquidity risk– An Investor cannot withdraw from the Loan Sub-Fund until the Loan Sub-Fund is wound up. DomaCom does intend to offer a facility through which Investors can seek to sell their Units to another party, however there is no guarantee of this.
- Damage or loss to Security Property – There are a range of events that can damage the Security Property including acts of God (fire, flood, earth quake and other natural disasters) through to accidents, negligence, and failures of maintenance. The Borrower’s insurance may not cover or may not fully cover such losses which can impact its ability to repay the Underlying Loan.
- Underlying Loan Servicing Risk– There may be insufficient income generated from the Security Property to meet the borrowing costs. The costs associated with Security Property may exceed its income. The Borrower will seek to ensure that there is sufficient income to meet expenses including holding a cash reserve equivalent to 4 months’ rent at the time of establishing the Underlying Loan and also ensuring that that the Interest covered ratio is sufficient to cover the interest expense.
- Tenancy Risk- The Borrower’s ability to service the underlying loan is predicated on the security property (solar farm) being able to generate income from the operating business.
- Asset Risk – The property is to be acquired cannot exceed an independent property valuation of of more than a loan to valuation ratio of 60%. The value of the Security Property would need to fall by 40% to put at risk the repayment of the Underlying Loan.
- Interest Rate risk– The interest rate has been set at a rate and is fixed for a term. During this time there is a risk that interest rates could rise, resulting in investors receiving a lower return on their investment than an alternative lending product.
- Non-recourse lending – Investors should be aware that the Underlying Loan is secured with a first ranking registered mortgage over the income producing Security Property that is held by the Borrower. In addition, the Underlying Loan is secured through a general security agreement against all the assets of the Borrower specific to the Property Sub-Fund. If the Borrower defaults, there will be recourse to all the assets of the Borrower (limited to the assets of the Property Sub-Fund that holds the Secured Property) however, there will be no recourse to any other assets of the DomaCom Fund, nor any recourse to the assets of the Trustee, the Manager, or the Custodian.
- Economic risk– There is a risk that the general economic conditions in Australia may change in relation to interest rates, employment rate and economic growth that could in turn have an impact on the property market and specifically the value of the Security Property and the Borrower’s ability to repay the Underlying Loan.
- Timing risk – There is a risk that the Loan Sub-Fund may not proceed if the proceeds in relation to the Property Sub-Fund are not raised for the equity component. If this situation were to occur the Loan Sub-Fund would not proceed, and the capital raised would be returned back to the investors.
- Security Property Sale risk- There is a risk that the Security Property may not be able to be sold at the conclusion of the term of the Property Sub-Fund. This may cause delays in the repayment of capital to the Loan Sub-Fund beyond the Loan Sub-Fund’s term.
Fees and Costs
Refer to section 13 of the PDS for Fees and Other Costs
The Management Fees for managing your investment
- Cash held in your Cash Account 0.22% p.a.
- Loan Sub-Fund 0.44% p.a. of the value of the loan.
All costs in relation to establishing the Underlying Loan will be paid by the property sub-fund. No transactional and operational costs will be borne by Investors of the Loan Sub-Fund.