New fund to invest in US property

A new US commercial property fund targeting Irish investors was launched in Dublin last night.

The fund is being operated through a vehicle called Wilton US Commercial, which is headed by Wil Byrne.

The two other directors are Ian Finnegan, managing director of property consultancy firm Finnegan Menton, and Camille Julmy, of Chicago-based US Equities Realty.

"We're looking to raise $50 million (€36 million), leveraging that at 75 per cent loan to value to have a total pool of funds for investment and working capital of around $200 million. This is the first of a series of US ventures we are putting together between us," said Mr Byrne.

The vehicle is filing with the US tax authorities, the IRS, as a real estate investment trust (Reit) which Mr Byrne said would offer tax advantages to investors.

"Gains will be coming back with a net tax rate of 20-25 per cent. Tax gets paid once, so the gains come back into Irish hands in a very efficient way.

The fund will have a minimum investment of €100,000 and is targeting personal investors and also self-administered pension investors.

Despite the stream of negative news from the US about problems with the sub-prime mortgage market, Mr Byrne said the fundamentals of the US economy remained strong and that the depreciation of the dollar made it a good time for Irish people to invest in the US.

"Over the past 12 months, euro-based investors have gotten a 12.5 per cent gain in terms of purchasing power in terms of going into the US market," he said.