Property-focused fund manager DomaCom has successfully raised $7 million to fund its new equity release product.
The placement has been made to new and existing professional and sophisticated investors at a post-money valuation of $24 million.
Reuben Buchanan from corporate advisory firm, Axstra Capital, who assisted DomaCom in the placement, said he was surprised with the level of interest and the speed at which the group secured funding from both new and existing investors.
“The DomaCom solution to property investing is a game changer in so many aspects,” Mr Buchanan said.
“Not only is it the first platform of its kind in Australia – it is the first in the world,” he said.
The funds raised from the placement will enable DomaCom to accelerate the launch of an equity release product for senior Australians which is targeted for the first half of 2015.
The product will be available to brokers and is expected to sit alongside the current equity release mortgages in the market.
“We are very pleased that the raising was well supported by both new and existing shareholders in DomaCom,” DomaCom chief executive Arthur Naoumidis said.
“The support shown by our investors, many of whom are from the financial services industry, demonstrates a high level of confidence in the company and the investment model we have created,” Mr Naoumidis said.
“DomaCom is now in a strong financial position to commercialise the fractional property investment model, bring on new complementary products such as the equity release and to build a substantial team to take these to market,” he said.
“The application of our model is almost boundless and we will be discussing its potential with existing property funds, SMSFs and industry funds.”