NDIS/SDA Properties - Too good to be true?

They do mention something about a related SIL in their blurb .....

Obviously some of the long term not-for-profits have pre-existing fully integrated models eg Cerebral Palsy . Have they been given time frames under which they have to break up / divest their divisions ?

 

They now it's coming. Some are being proactive. But some are ignoring or thinking they are too big.

 

$5m sale of Brisbane SDA property. Under contract with mainstream valuation coming in at contract price. Not quite finished but full. 4 unit complex. 8% cap rate on gross income. Also have a few more managed funds chasing similar properties at 7% net.

 

Hi RPI

If it was your investment, what area would you be looking to invest into a SDA property?

Queensland seems to be where the majority are being built, however from what I can see Central Coast/Hunter NSW, parts of Melbourne and possibly ACT are getting some activity too now.

 

Wherever you want to. It's everywhere.

More old property spruikers selling Mexicans dodgy QLD property than in other states. Although our planning rules help.

We have clients building everywhere


Here's my current QLD ones - we still have a lot of gaps to fill in.

 

Find looking for 300 SDA units.
Institutionally Capitalised Buyer Looking for 300 Units on East Coast - Real Estate Agent Video - NDISP

 

My Reply:

I'm interested in exploring options/chatting further. Do you have a business email I can't connect with you on?

Cheers Amber

 

His phone number is in his post and he’s literally linked his own website which has further contact details….

 

Every one has an email they can't connect on ...

Cliff

 

Any brokers out there funded any of these? I have read many different things including initial 70% funding by a second tier/reval via mainstream?

 

Two questions to RPI :
1. Is there a government register of Specialist Disability Accommodation (SDA) Providers?
2. If, for argument's sake, there is a minimum investment of $700k, can a group of investors, e.g. 7, invest $100k each? Or does the group of investors have to create a partnership or trust themselves for this?
TIA

 

We looked at doing a joint venture between 3 SMSF's and it was feasible, but was for a block of units.

Cliff

 

Re question 1
Google gave me a list 510 pages long ...

re question 2
I can’t see why you couldn’t but the issue would be how you’d organise it . Our accountant was suggesting a joint venture 3 for a block of four units , but it was pretty obvious before it started that one person needed convincing and I wasn’t interested in that set up . We also came to the conclusion we’d prefer two villas and keeping control of the land long term

I find it hard to imagine a group of seven people getting organised enough to have someone interested in dealing with them .most of the SDA providers seem to be pretty snowed under and if I was them I’d be wary of that set up

Syndicates / joint ventures are complicated. I could imagine a managed who puts together syndicates for sophisticated investors doing something like that but I haven’t heard of anything like that , but I haven't been looking .

we have a friend who does put syndicates together and I know he was approached to look at it , but he thought it was in the too hard basket and wasn’t interested . He was wary about government controls and the market being over supplied at some stage .

that is something I wonder about longer term but given the lack of quality of some properties I think at some stage we’ll hear stories of “ investors being dudded “ so that might put some off SDA .

we’ve put a lot of thought into where we’ve done ours , each for different reasons , to future proof them as much as possible .

Cliff

 

1. There is are register of all NDIS Providers.

Find a registered provider | NDIS

You have to be a registered SDA provider if you live in your own SDA property as a self-provider. So the numbers are a lot higher than in reality.

I'd love to be able recommend other SDA Providers to people. Whilst there are a few well intentioned ones (not the Real Estate/ Project Marketer types) I'm yet to know one that is compliant outside of some not for profits doing their own stuff. The NDIS Quality and Safeguards Commission are starting to give some "friendly reminders" to a large number of SDA providers about their obligations. Until recently I believed that many were just ignoring their non-compliance because it was too expensive, but have found out it's worse, they actually had no idea of some of the things they had to do (eg every contractor, sub-contractor, trade, service etc is a worker under the act - you need to induct them into your policies and procedures, have worker screening, be able to identify who the individual is, time they were there, mechanism to tell them how adjust service based on tenants etc).

2. It's same as any property investment. Normally my law firm could setup a structure for you but wouldn't if you went with the provider I'm involved with. @Terry_w would be my recommendation.

 

Curiously, how do banks assess SDA income for future loans? What haircut is applied?

 

Will the syndicate/fund who is GST Registered be able to claim GST Credits on the new properties bought or construction costs to special purpose build NDIS properties?

 

My thoughts as well after a cursory glance.

Would be interesting to hear your findings on preparing the dual occs for NDIS tenancy, extra costs, resale options etc.

 

Hi Sasha
hope you are well. I came across your post regarding SDA housing Investment, I am also from SA and currently in exactly the same situation and would love to find out how you ended up going with building NDIS accommodation.

 

Any updates on NDIS properties.
Those who have jumped on it from the beginning.
Share your thoughts?