What is a wholesale investor? CrowdProperty Australia explains

Many investment opportunities are classified as ‘for wholesale investors only’ (including ours). So, what is a wholesale investor? What’s the difference between wholesale and retail products? And what is a sophisticated or professional investor? We explain all here…

 

What is a wholesale investor?

Investing in CrowdProperty project loans is currently only available to wholesale investors. Wholesale investors, or wholesale clients, are people, trusts or self-managed superfund (SMSF) members that can be defined by the following classifications:

  • Has net assets of $2.5 million, or 
  • Has gross income for each of the last two financial years of at least $250,000 a year , or
  • Invests a face value of $500,000

Alternatively, a wholesale investor can also be an SMSF, where the trustee(s) for the SMSF meet the above criteria, or controls gross assets of at least $10 million (including any amount held by an associate or under trust that the person manages).

 

What is a retail investor?

A retail investor is, in essence, everyone who is not a wholesale investor and wants to invest in investment opportunities. CrowdProperty Australia doesn’t currently offer retail investment opportunities. Our UK sister company does.

 

What’s the difference between wholesale and retail products?

The key difference between wholesale and retail investment products is in compliance. Retail products tend to have much higher regulation and disclosure requirements in a bid to ensure a greater level of consumer protection.

Retail investments are generally available to all investors, and typically have a lower minimum investment amount. For example, our minimum investment amount for wholesale investors in Australia is $10,000, whereas our sister UK company has a minimum retail investment amount of £500. (They also have a £2000 pledge limit on projects for the first 10 minutes to allow as many people as possible to invest. Our UK project loans typically close in under 30 seconds, so you can see why!)

Wholesale products are offered to investors who are considered to be more experienced in investing and are typically aware of the risks with investments like these.

 

What is a sophisticated investor?

If you read around the internet on these investor types, ‘sophisticated’ and ‘wholesale’ are sometimes used interchangeably. However, there is a difference. A sophisticated investor is defined as:

  • The holder of an Australian Financial Services License
  • Controls assets of at least $10 million
  • A listed entity, or similar

Investing entities as sophisticated investors can be investment funds/trusts, superannuation funds, companies, and some other entities.

 

What now?

If you’re reading this, it may be that you qualify as a wholesale investor, but you didn’t really know that yet. So, the next step is to chat to your accountant and see if you tick the boxes. If you do, why not register with CrowdProperty and take a look at some of our projects and you too could potentially earn up to 7% p.a. target interest returns* in the CrowdProperty marketplace.

 

Sign up to CrowdProperty

 

*Target returns, not forecast returns. For wholesale investors only. Terms, conditions and risks apply.

Disclaimer

The CrowdProperty Investment Trust (the Trust) is an unregistered managed investment scheme. The Trust is only available to investors that are wholesale clients as defined in s761G of the Corporations Act 2001 (Cth).

Investors pledge their funds in the Trust which makes first mortgage secured loans to SME property developers.

Withdrawals can only be made when the Investor funds are in Cash Interests in the Trust. Refer to the Information Memorandum (IM) for more information.

CrowdProperty Pty Ltd (ACN 633 516 195) is the investment manager of the Trust (Investment Manager). The Investment Manager is a corporate authorised representative (No. 001285637) of Quay Wholesale Fund Services Pty Ltd AFSL No. 528 526, ACN 647 044 602. The Investment Manager's authority under its Corporate Authorised Representative Agreement with Quay Wholesale Fund Services Pty Ltd is limited to general product advice regarding the Trust only. Quay Wholesale Fund Services Pty Ltd is the trustee of the Trust and the issuer of its IM (Trustee).

The contents of this document are not intended as financial product advice and have been prepared without taking into account your personal circumstances, investment objectives or particular needs. You should read the Information Memorandum for the Trust in full to consider whether an investment is appropriate for you.

Neither the Investment Manager, Quay Wholesale Fund Services Pty Ltd, nor the Trustee guarantee the repayment of capital, the performance of any investment or the rate of return for the Trust. Past performance is not necessarily indicative of future performance. An investment in the Trust is not a bank deposit and is subject to greater risk than cash investment products including loans of income and part or all of the capital itself.

We strongly suggest that you seek your own professional financial or legal advice prior to any investment decisions.


06 May 2021

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