A new company St Laurence Property and Finance Ltd, is seeking to raise $6 million from the public for use in a variety of property related investments.
Up to 7.5 per cent of the funds being raised can be used to buy units in current St Laurence property syndicates which are for sale.
St Laurence managing director Kevin Podmore says this fund will act as a buyer-of-last-resort for people wanting to exit their current property syndicates.
The new business is also allowed to invest in property either directly or indirectly, plus it will be able to underwrite the placements of syndicated property and property bond issues.
The company will also look to provide property purchase takeouts for developers in instances where the directors consider the completed development will be suitable for syndication.
All investments made by the company must be capable of generating a return on shareholders' equity of at least 15 per cent annually.
Podmore says the new business is designed to compete directly with Waltus Property Finance and Strategic Finance.
He says these two companies appear to have successfully raised money in an environment where property in general is out of favour with investors, and new syndicates struggle to raise money.
Podmore says because the syndication market is slow at the moment St Laurence needed to find another product that would utilise the skills within the company.
Competitors had shown a debt security like this was popular with investors, he says.
St Laurence Property and Finance is offering investors 11 per cent for a three year term.
Podmore says this rate is higher than what Strategic and Waltus are offering, and it reflects the level of risk involved in this type of investment.
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