SMSF structural financing next big thing

Strategies around structural financing or capital funding were the next major pioneering stage for SMSFs, a sector expert has said.

The concept of structural financing is an evolution from SMSF investments to actual capital funding opportunities, NowInfinity principal Grant Abbott said.

“You’re in a situation of pure investment play in a retail or industry fund where it’s an investment and that investment is beholden on the underlying trustees or fund managers,” Abbott said.

“Once you move over to an SMSF, it moves from an investment into capital.”

For example, buying property using the underlying equity in an SMSF to boost the investors’ capital through leverage was markedly different from an investment play, he said.

“To me, that is the sexy stuff that the early adopters are using now and getting innovative with and the innovative stage is where you make money.

According to Abbott, this was going to be the next big wave for SMSFs.

“The list is endless,” he said.

He revealed NowInfinity Legal was preparing at least two or three of those structures every week.

“Whether it’s a joint venture between a family trust and a superannuation fund or whether it’s a 13.22C trust or if it’s a superannuation unrelated investment trust for independent parties but it is a company,” he said.

“That’s what I call SMSF structured financing.

“This is the most exciting part. You can now start to pull investment capital together to set up smaller syndications to go and buy businesses – to set up and to do property development.”


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