Property Syndicate Conversion Proposal 

Australian Unity Investments today confirmed that investors in three of its five property vehicles have immediately voted to support the proposal to staple together a number of trusts and syndicates in an effort to establish a $400m Retail Property Fund.

Although initially setting a 90 day period to engage with investors and obtain approval for the proposal, investors in the Retail Property Trust, the Regional Retail Property Investment, and the East West Property Syndicate immediately endorsed the proposal to convert their investments into a single open-ended property trust, with almost 90% of all investors who cast their vote voting ‘yes’.

Investors in the remaining syndicates will finalise their voting during the remainder of the proposal period, which ends on 28 February 2009.

The vote by investors in the Sunshine Homemaker Centre Property Trust is scheduled for 18 December, following requests from investors and advisers to have more time to consider the proposal and to send their proxy forms.  To date, support from investors has been very strong.

Investors in the Wyong syndicate have their meeting scheduled for much later in the proposal period, in late February 2009. This follows one investor having circulated materially incorrect information regarding the proposal, and subsequent confusion with investors. To remedy this situation, Australian Unity is preparing additional information for investors and will organise several briefing sessions over the next couple of months.

Australian Unity has developed the proposal, which once implemented is expected to deliver investors a total return of around 14.5% per annum (based on current and expected interest rates from June 2009), to provide investors more flexibility in accessing their investment, greater diversity, and lower risk.

“The proposal comprises an expected income return of around 9% and a further growth return of around 5.5% based on scheduled rental increases. For example, investors in the Wyong syndicate today receive slightly higher income, around 10% per annum, but with no expected capital growth for the life of the investment. So the proposal compares very favourably with their current position.   

The main benefits for investors under the proposal include:

• the ability to access some or all of their investment through a regular redemption facility (an attribute not possible under a syndicate structure)
• a significantly more diverse tenant mix which reduces the risk levels of the investment
• more flexibility in managing and developing the properties.

The proposal brings together a number of excellent properties which Australian Unity manages, and the historical returns, which have been uniformly outstanding, are shown below:

Important information:
Performance is as at 30 June 2008.  In your investment decisions, however, don’t overestimate the record of past performance of a product, as it is not a reliable indicator of likely future performance.  Our web-site www.australianunityinvestments.com.au provides further information about the  proposal.