FAQ

The initial term of the CRT is 7 years from the Issue Date, 8 July 2009, unless extended by an extraordinary resolution by investors. For further details refer to Section 1.3 of the PDS.

The responsible entity of the CRT is Cromwell Property Securities Limited ABN 11 079 147 809 (“Cromwell”), a property investment fund manager which commenced operations in 1998. Cromwell currently has over $1.7 billion in assets under management. Cromwell holds an Australian Financial Services Licence (No 238052) granted by ASIC. Among other things, the Licence allows Cromwell to act as the responsible entity of registered managed investment schemes such as CRT. Cromwell is a wholly owned subsidiary of Cromwell Corporation Limited and part of Cromwell Group, a stapled security listed on the ASX (ASX:CMW).

Distributions for the CRT are paid monthly and should be paid within 20 days after each month end.

All Class A Units issued under the PDS dated 25 February 2009 will be issued at $1.00. Units will maintain a nominal value of $1.00 throughout the life of the Trust, although updated NTA per Unit values will be available in the Trust’s annual financial report.

The commencing distribution is forecast to be 8.25 cents per Unit per annum which, at the issue price of $1.00 per Unit, equates to 8.25% pa. From Practical Completion of the Riverpark Building (expected to be 30 June 2010), distributions are forecast to increase to 8.50 cents per Unit per annum.

The Trust’s first distribution was paid to investors within 20 days after the end of July. Distributions are proportionate to an investor's interest in the Trust through that month.

The Trust has a 7 year term during which investors have no right of withdrawal.

The gearing ratio of the Trust (as calculated by bank loan divided by property value) is estimated to be 55% on completion of construction of the Riverpark Building.

For the period to 30 June 2012 distributions are forecast to be 100% tax deferred.

Allowances for the amortisation of the Building, depreciation of plant and equipment and the writing off over time of capital raising and borrowing costs result in a portion of the distributions being tax deferred.

Deferred tax is usually payable in the year in which your investment is sold, transferred or otherwise disposed of and may be reduced in the future by capital gains tax discounts or other individual investor circumstances.

All investments have associated risks. Key risks of an investment in CRT include:

Construction risk – the risk of overruns in cost or delays in completion of the Building

Rectification risk – the risk that the Building may contain defects at Practical Completion, rectification of which may be costly

Tenancy risk – the risk that CRT income declines if the Property is not fully leased, tenants default, or rent levels decline

Valuation risk - the risk that the Property may decline in value

Insurance risk – the risk that the performance of the Trust may be adversely affected where losses are incurred due to uninsurable risks, uninsured risks or under-insured risks

Diversification risk – the risk associated with the Trust due to its lack of diversity (it has one building and a single tenant occupying 93% of the net lettable area)

Borrowing risk – the risk that any potential reduction in distribution or capital value is magnified due to the gearing of the Trust

For full details please refer to Part 3 in the PDS.

CRT has a compliance plan which has been lodged with ASIC. The compliance plan contains procedures for ensuring compliance with the Corporations Act and the Constitution of the Fund. A Compliance Committee is in place which, amongst other things, monitors Cromwell’s adherence to the Plan.

Centrelink treats investments such as CRT as financial investments for the purposes of its deeming provisions, with the result that the amount invested is ascribed income at a deemed rate and is treated as a financial asset.

Yes, Cromwell issues tax statements/reports after the end of the financial year.  The first tax statement for CRT investors will be issued following the 2010 financial year.  We endeavour to release tax statements at the end of August. You should not lodge your tax return until the statement is received.

Contact the Cromwell Investor Service team on 1800 334 533, or your financial advisor.