What is a Wholesale Investment?
Southern Cross Partners provides mortgages lending under the regulations that govern Peer to Peer Lending in New Zealand. This legislation restricts the amount that can be borrowed by any entity to $2M in any 12-month period
It is these mortgage advances that are provided to our Investors as secured investment opportunities
As part of our normal business activity, we are often presented with lending opportunities in excess of $2M and under current legislation we have been unable to fund these through the Peer to Peer platform.
What we are able to do though, is to provide these to investors outside of the Peer to Peer framework, which we are doing with Wholesale Investors
Typically, the loans offered in this manner will be larger loans (requiring a larger investment) and they will generally have more complex securities attached to them, as opposed to a simple residential property
Investor legislation in New Zealand is designed to protect what we would call ‘Retail’ Investors, which is where our Peer to Peer platform is aimed. This legislation provides far less protection to Wholesale Investors, who are expected to have sufficient experience and knowledge to be able to make their own assessment of the merits of any opportunity
Because the sums are larger and the securities more complex, we are able to offer a higher interest rate to our Wholesale Investors typically above 7.00% p.a. (*subject to availability)
How do I know if I am a Wholesale Investor?
There are a wide range of ways to qualify as a Wholesale Investor, and these are explained in the attached Certificates. We consider that there will be 3 main ways that will be applicable to us:
1. Have at least $5M on net assets (or business turnover) under your control, or
2. Have at least $1M invested in a similar Investment (ie a type of Contributory Mortgage Investment)
Note that these 2 qualifications have to be met on the last business day on each of the 2 past financial years
3. Invest a minimum of $750,000 into a single investment
Note that with this last category, every individual investment that you make must be a minimum of $750,000 per loan
If you meet any of these criteria, you are likely to be accepted by us as a Wholesale Investor (note that there are other ways to qualify, that may apply to you)
What do I do if I want to proceed?
Firstly, you must register as an Investor with Southern Cross Partners . If you are not already registered with us please Click here to know more about becoming an Investor with Southern Cross Partners.
Once you are registered with us, you will then need to complete the Confirmation of Investor Eligibility where you are telling us which way that you comply along with the appropriate Wholesale Investor certification for the list below; (further confirmation may be required)
- Wholesale Investor Certificate
- Eligible Investor Certificate plus Third Party Confirmation
- Wholesale Investor Acknowledgement (Minimum Subscription)
These can be emailed to investments@scpartners.co.nz and the we will then provide you with the current list of investment opportunities to view.
Important Information
• Wholesale investment opportunities are provided by Southern Cross Finance Limited, a sister company to Southern Cross Partners Limited
• All loans, and investments are sourced and managed by the same people
• All cash and securities are handled and managed by our Trust Company, Loan Investment Trustees Limited, in the same manner as the Peer to Peer investments are managed
• The same Custodial Policy is used, subject to the same external audit and FMA reporting
• We are able to offer up to $2M of any opportunity to our Retail Investors (via the Peer to Peer platform), with the balance being made available to Wholesale Investors, if we elect to. If this does occur, the Minimum Investment Sum and the Interest Rate offered to Wholesale Investors are likely to be greater. You are free to elect to invest through both avenues if you wish to.
Further key points;
- Available Wholesale Investments are provided on a static list that must be requested and is not available on the website platform
- Only investors registered as Wholesale investors have access to this specific list.
- The list is not extensive and does not change as often as the Retail list on our website platform.
- All orders are to be confirmed by email to heatherk@scpartners.co.nz
- From time to time upcoming deals may also be emailed out to Wholesale Investors to advise if they are interested in them when they become available.
- The Secondary Market process (Exiting an investment by on-selling to another investor) does not apply to deals invested in as a Wholesale Investor and can only be offered to other Wholesale investors.
- Most of the loans on offer will have a development, construction, subdivision aspect to them therefore the maturity date will remain fluid and the loan may be extended if that is the best strategy to have the loan repaid.
- All loans continue to be managed fully by Southern Cross Partners
- An updated Wholesale Investor certificate is required to be completed and resigned by each investor every 2 years
To talk through our Wholesale Investment program you can contact any of the investment team;
- Carlene McEwen – BDM -Waikato/Bay of Plenty – Ph: 09 535 2239
- Ross Latham – BDM – Auckland & all other areas – Ph: 09 535 2239
- Hend Salam – BDM – Auckland – Ph: 0800 00 58 43
- Heather Kentsley – Investment Manager – Ph: 09 535 2239
