OPX - Property Exchange

 

 

 

  

Where buyers and sellers of syndicated property

meet and transact....

     

What is OPX?

Ocean Property Exchange ("OPX") is an 'over the counter' marketplace where 'Investors' in syndicated commercial, industrial or rural property investments ('Investments') can offer their Investments for sale.

Fundamentals of the OPX

Investments in syndicated property are made on forecast returns, by Investors who at the time of purchasing their Investment have comfort with the time frame of the Investment. Investor circumstances can often change, requiring investors to consider a divestment of their ownership interest in the property syndicate.

OPX provides Investors with an independent, managed, 'over the counter' marketplace where Investors wishing to sell their Investment in a syndicated property can present their Investments for sale to prospective purchasers.

The Market will provide Investors with an ability to vary the 'effective yield' of the investment that they wish to sell through changing its price, therefore pricing it to meet the price level being set by incoming investors.

For example -

  • a $100,000 Investment in a property syndicate providing a cash return of 9% will return $9,000 per annum investment to the investor;
  • an Investor wishing to sell the Investment, and prepared to take a discount on their initial Investment, may look to sell their ownership interest in the syndicate for $90,000 - offering a cash return to the new Investor of 10% ($9,000 / $90,000).

An efficient market works on the premise that a product will sell when the price level offered by a vendor meets the price offered by a purchaser. OPX provides a marketplace where Investors can offer their Investment for sale, increasing liquidity in the property syndicate.

An Investor's ability to sell their Investment may be improved through changing the effective yield at which the Investment is offered to the market - through modifying the price of the Investment.

How does OPX operate?

  • Investors wishing to sell their Investment in a syndicated property will list details of their investment on OPX;
  • Purchasers wishing to acquire Investments being offered for sale on OPX, register with OPX and receive a detailed information package on the Property; and
  • After agreeing commercial terms which may include price and settlement date, parties will enter into an agreement of sale and purchase for the Investment - which will be managed through.

What information is available on OPX?

Properties offered on OPX are detailed in a Summary Form

Prospective investors can drill down to see additional information on specific properties.

What are the costs?

  • Sellers pay:

    - Registration Fee - $500 to register their investment for sale on the OPX; and
    - Completion Fee - equal to 2.0% of the transaction value.
  • Purchasers - do not pay a fee to register or complete a transaction on OPX.

Legal costs incurred by sellers and purchasers are to their respective accounts and are not incorporated in the above fees.
Ocean Partners has established a panel of lawyers who have reviewed and are familiar with OPX standard contracts and can provide advisory services to prospective Investors wishing to sell or Purchasers wishing to acquire Investments.

What is Ocean Partners' role?

Ocean Partners manages OPX, including:

  • Registration and management of Investors wishing to sell their Investments;
  • Registration and verification of prospective purchasers, providing an increased level of comfort to sellers;
  • Provision of summary information on Investments being offered for sale through the OPX website to purchasers; and
  • Liaison with sellers, purchasers and other advisers to effect a sale of investment interests.

Ocean Partners does not provide any representation or warranty with regard to:

  • Quality of investments being offered for sale on the OPX;
  • Historical or forecast returns of the property investment or the effective yields being offered by vendors;
  • Legal right of the vendor to sell their interest; or
  • An Investor's ability to complete a sale of their Investment through the OPX.

OPX is not a registered exchange, what does this mean?

  • OPX is an unregistered trading facility and accordingly, OPX is not subject to the same regulatory protections as a registered exchange.
  • A registered exchange is required to maintain detailed rules relating to the governance and conduct of listed companies, and the conduct of participating brokers. Compliance with these rules is monitored and enforced by the exchange. As OPX is an unregistered trading exchange, the OPX does not offer such protections.
  • Rules of registered exchanges are vetted by the Minister of Commerce and are also subject to a specific Securities Commission monitoring programme. No such vetting or monitoring applies to an unregistered trading facility such as OPX.

Prior to executing a transaction originating from the OPX, purchasers will be required to execute a Waiver and Disclaimer.