18 December 2017

The Cromwell Direct Property Fund (Fund) has secured its fourth direct commercial property asset, located at 433 Boundary Street, Spring Hill, Brisbane for an acquisition price of $42 million.

The property is an elevated 3,778 square metre (sqm) site comprising a three-level office building with approximately 6,000 sqms of net lettable area.

The property’s major lease is to International Education Services (IES), a provider of education services to international students. IES occupies two of the three floors of the building on a 12-year lease, with the remaining floor to be occupied by IES when the current tenant, Opus, vacates in 2019.

The property has a Weighted Average Lease Expiry (WALE) of 10.5 years, which in turn increases the Fund’s overall WALE from 9.2 to 9.4 years.

The acquisition takes the Fund’s direct property portfolio to $115.5 million and the look-through property exposure to eight assets, with a total investment value of $196 million.

The addition of the 433 Boundary Street property asset will increase the earnings of the Fund whilst maintaining a conservative direct gearing ratio of less than 10%.

The acquisition is due to settle on 19 December 2017.

Cromwell Funds Management Limited ABN 63 114 782 777 AFSL 333214 (“CFM”) has prepared this update and is the responsible entity of, and the issuer of units in, the Cromwell Direct Property Fund ARSN 165 011 905 (“Fund”). In making an investment decision in relation to the Fund, it is important that you read the product disclosure statement dated 29 September 2017 (“PDS”). The PDS is issued by CFM and is available from www.cromwell.com.au/dpf or by calling Cromwell Investor Services on 1300 276 693. Applications for units in the Fund can only be made on the application form accompanying the PDS. This update has been prepared without taking into account your objectives, financial situation or needs. Before making an investment decision, you should consider the PDS and assess, with or without your financial or tax adviser, whether the Fund fits your objectives, financial situation or needs. CFM and its related bodies corporate, and their associates, do not receive any remuneration or benefits for the general advice given in this update. If you acquire units in the Fund, CFM and certain related parties may receive fees from the Fund and these fees are disclosed in the PDS.

Please note: Any investment, including an investment in the Fund, is subject to risk. If a risk eventuates, it may result in reduced distributions and/or a loss of some or all of the capital value of your investment. See the PDS for examples of key risks. Past performance is not indicative of future performance. Forward-looking statements in this update are provided as a general guide only. Capital growth, distributions and tax consequences cannot be guaranteed. Forward-looking statements and the performance of the Fund are subject to the risks and assumptions set out in the PDS.