September 2021 unlisted property market update
Investing | 4 MINUTE READ
In this ‘In conversation’, we talk to Relationship Manager, Jonathan Bredin, who joined Cromwell in late 2020. As a member of the Cromwell Funds Management (CFM) team, Jonathan is responsible for maintaining relationships with Cromwell’s direct retail investors.
Jonathan moved to Australia in 2007 from his home city of Dublin, where he worked as a stock broker. He has 20 years’ experience in equities markets and investing, and in this edition of Insight, we ask him about his time at Cromwell so far and the most common questions he receives from investors.
I began my career in an entry-level stock broker role at Dolmen Stockbrokers in Dublin. I worked there for a few years before I felt I needed a change of scenery so decided to come to Australia. I found a job at CMC Markets in Sydney where I worked in a variety of sales and client services roles.
Over the last nearly 20 years I have developed a strong knowledge of stock markets and investing in general and these qualities have always been the backbone of my various roles. I also enjoy talking to, and getting to know, investors. It’s important to find out what they are looking for from their investments so I can determine which product best fits their objectives.
What initially attracted me was that Cromwell was an ASX-listed company with a great reputation. The focus is property which has provided me with the challenge of learning about a new industry. The common thread between Cromwell and my previous roles is investing, which I am passionate about, and I enjoy being able to help people out with their investment questions and to understand our products better.
One thing I’ve really noticed at Cromwell is the loyalty of our investors. There are quite a large number of them who have been with us for a very long time, and across multiple investments. I believe this is the result of Cromwell’s investment success over a long period and also the personal service the team provides each and every one.
Despite its size and financial capabilities, Cromwell still has the feel of a family-run business where everyone supports each other. I’ve heard only positive feedback from long-term clients regarding their investments and dealings with Cromwell in general. The transparency and accessibility of the team is second to none, and I think investors feel comfortable and familiar with us.
Coming from a non-property background, the biggest challenge for me so far has been bringing myself up to speed with, and learning about, the property sector, the terminology and of course Cromwell’s funds.
The support I’ve received from my team has been incredible and after eight months I can confidently say that I have settled well into my role. I enjoy engaging with our investors, and to be able to field all of their queries and hopefully to make them feel confident investing with Cromwell.
Many of our clients are retirees, either in their own name or as self-managed superannuation fund (SMSF) investors. So, what they are generally looking for is a secure, reliable source of income from their investments. Bank deposits are offering very little return at the moment, so investors are seeking new ways to invest their money, without the volatility of equities or the risk that their capital takes a huge hit. Many of them still remember the GFC and what happened to investors’ capital throughout that time.
Investors have been nervous about COVID-19 and how it might impact our buildings and tenants, but because our tenants are primarily government and blue chip we have been able to reassure them that the assets are well positioned to get through the pandemic, and that their income stream will continue to be paid. In the end I think everyone wants to feel comfortable that their investments are safe and in capable hands.
The Cromwell Direct Property Fund (DPF/the Fund) has proven to be a resilient and consistent portfolio, coming through the disruption of COVID-19 remarkably well. The Fund is designed to provide its unitholders with regular, reliable income through market ups and downs and as you can see from the graph (opposite) it has done exactly that. I think this is largely attributable to the selection of quality assets and high percentage of government and blue-chip tenants in the portfolio.
Recently, the fund acquired 545 Queen Street in Brisbane, an A-grade office building located at the entrance of Brisbane CBD’s ‘Golden Triangle’ for $117.5 million. The acquisition is accretive to fund earnings with the government and multi-national tenant mix and is consistent with the Fund’s stated objectives and profile.
There are other funds out there that might pay a slightly higher return but DPF also has a monthly limited withdrawal feature that we know unitholders value. This means we keep some cash uninvested, hence the lower return, but this in turn provides unitholders with a (limited) opportunity to withdraw if their circumstances change.
Our current focus is the same as it has always been, to find and purchase high-quality assets that can benefit investors, and then to carefully look after their interests throughout the lifetime of their investment with us.
Cromwell began its life as a Funds Management business and we are ultimately looking to use our real estate and funds management skills to continue to create and then return wealth to our investors. I’m excited to now be part of the team that is focused on doing just that.
At the moment, a lot of my time is taken up by my little girl Nell who is 18 months old, and my wife and I have another baby due in August. Separate to that, I play hockey and have done so for almost 28 years. I used to play competitively in Ireland, representing my country at club level in the EuroHockey Club Championships. A lot of my weekends at the moment are also spent house hunting, which is proving to be a painful process!
Jonathan (or JB to those who know him) and the rest of the Cromwell Investor Services Team can be reached on 1300 268 078, or by emailing firstname.lastname@example.org. You'll know it's JB by the Irish accent!