Investors can access the US residential property market if they buy into a new property fund that is seeking to list on the Australian Securities Exchange.
The US Residential Fund aims to raise $60 million through an initial public offer (IPO) of new stapled securities at $1 each.
A free option, exercisable at 95 cents, will be issued for every two stapled securities.
Fund chairman Owen Lennie described the fund as a “no fuss” gateway for Australian investors into the US residential market, which is recovering from the global financial crisis.
The fund finds houses and apartments in select US cities that have faster economic, job and population growth, such as Atlanta in Georgia, and Dallas and Houston in Texas.
Research showed that household growth was above the US national average in Atlanta, Dallas and Houston, but the supply of rental housing had not kept pace with increasing demand.
Construction of new homes was significantly less than a decade ago.
The fund also finds tenants for the properties and looks after insurance, taxes, repairs, and compliance with landlord and tenant legislation.
Fund managing director Andrew Meakin said the fund had been operating in the US since 2011.
“The executives of the fund have hands-on property due diligence and management expertise, and experience in arranging property loans in the US, giving comfort to Australian investors who have always appreciated the value of property investment but lacked an avenue to gain exposure to the recovering US residential property market,” Mr Meakin said on Monday.
The fund will own a total of 149 rental houses from the outset, with the initial portfolio valued at $US14.1 million.
In addition to buying property for rental income, the fund aims to make capital gains through profitable renovation of houses in neighbourhoods that appeal to home owners.