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On the back of SCA Property Group's (ASX: SCP) successful unlisted retail fund strategy called SURF the company has launched the third iteration of SURF valued at $58 million.
SURF 3 is currently raising funds to help acquire a portfolio of shopping centres on the east coast to form the new unlisted retail fund.
SCA is looking for investors to raise $35 million to help acquire the $57.9 million portfolio of neighbourhood shopping centres in Moama and Swansea in New South Wales, Woodford in Queensland, and Warrnambool in Victoria.
The four properties are currently held by SCA, but will be sold into the new unlisted fund at an arm's length for the benefit of new investors into SURF 3.
SURF 3 fund manager Melissa Kingham says each of the assets are well positioned to deliver strong dividends for investors.
"All four assets are surrounded by populations that, demographically speaking, are pre-disposed to visit their local shops for groceries and other essentials," says Kingham.
The Moama Marketplace, Swansea Woolworths and Woodford Village properties are anchored by a Woolworths supermarket and Warrnambool by Target. Moama is also anchored by a Woolworths petrol outlet.
SCA says the fund income is primarily generated by the anchor tenants, with the specialty tenants being non-discretionary focused including medical centres, pharmacies and food-based tenancies.
Kingham says SCA has already seen significant registration from interested shareholders.
"Already we have over 50 per cent registered interest from SMSF trustees who are looking for long average lease expiries and stable distributions," says Kingham.
SCA will manage the assets on behalf of the fund and will co-invest a minimum of 20 per cent of the amount to be raised.
The SURF 1 and SURF 2 unlisted property funds have delivered unitholders annual returns more than 8 per cent and 7 per cent respectively since being launched in October 2015 and June 2017.
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