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Our Core BusinessAt LDC Infrastructure we buy the rights to the rents underlying key infrastructure assets. This includes the leases for:
Telecommunications towers & rooftopsOutdoor advertising billboardsWind turbines.
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Creating ValueThe majority of our clients don’t recognise the value in their infrastructure lease until they work with LDC. Our clients range from individual property owners to publicly-traded companies, but they all have one thing in common – they have a better use for a lump sum than ongoing rental payments. In the past we have seen clients create value with their lump sum in different ways:
Real Estate – reinvesting the sale proceeds into real estate to target long-term capital growth in addition to recurring income
Shares – reinvesting in the share market to enjoy a balance of long-term capital growth and shorter term yield
Reducing Debt – paying down debt to reduce risk and free up cash flow for other more profitable uses
Reinvesting in the Business – several small businessess have used the lump sum to grow their business to the next level
Capital Purchases – sometimes it is the right time to buy something fun (new car) or something essential (new tractor)
Superannuation – some of our clients have used the sale proceeds to bolster their superfund or even allow them to retire immediately
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Phone: 1300 149 449 | [email protected] | www.ldcinfrastructure.com.au
Our MissionLDC Infrastructure is the Australian leader in ground lease acquisition and wholly owned by Landmark Dividend LLC. Landmark has over 3,000 leases under management and capital resources of over $1 billion.
At LDC Infrastructure we pride ourselves on providing the fastest and easiest access to capital for property owners with telecom, billboard or wind turbine leases on their property. We specialise in extracting value for our clients by placing a premium price on these assets.
Large scale solar farmsFibre optic cableData centres
Eliminating RiskWhen LDC acquires the rights to a lease we take on the risk associated with the site and the lump sum is completely non-recourse. There are two primary risks associated with infrastructure leases:
Decommission Risk - Although the risk of your site being decommissioned in the short-term is low, it does exist. In the telecom industry, consolidation has resulted in leases being cancelled, while in outdoor advertising, numerous smaller format sites have been removed. Meanwhile, wind turbines are said to have a useful life of 20-25 years from installation, which results in uncertainty after this period.
Rent Reduction Risk – This is the much more significant risk facing property owners. In the telecom industry especially, rents are continually being pushed down after years of increasing at rates above CPI. Billboard leases are also subjected to possible rent reduction, as advertising revenues are closely tied to the greater economy.
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Fast SettlementAt LDC we have built a reputation for swift settlement of transactions. Previously we have closed transactions within 22 days of acceptance of our offer. Our dedicated local closing and legal departments ensure we consistently close transactions within 30-45 days.
Phone: 1300 149 449 | [email protected] | www.ldcinfrastructure.com.au
Completed TransactionsAsset Type: Telecommunications TowerTenants: Telstra, Optus, VodafoneLocation: Perth, WAPurchase Price: $380,000
ASX listed industrial company that identified the telecom leases as non-core assets – selling them to reinvest in the business.
Asset Type: Telecommunications RooftopTenants: Telstra, VodafoneLocation: Sydney, NSWPurchase Price: $1,040,000
Commercial real estate investor that saw value in selling the leases to reinvest into additional properties.
Asset Type: BillboardTenants: oOh! MediaLocation: Brisbane, QLDPurchase Price: $480,000
Family trust that monetised their billboard lease and used the proceeds to pay down debt.
Asset Type: Telecommunications RooftopTenants: TelstraLocation: Sydney, NSWPurchase Price: $450,000
Bowling Club that capitalised on the value of their Telstra lease and reinvested in infrastructure at the club.
Asset Type: BillboardTenants: oOh! MediaLocation: Gold Coast, QLDPurchase Price: $106,000
Small business that sold their oOh! Media to extract extra value from the property before they sold the land.
TestimonialsIt was a pleasure closing the transaction with Luke Course. Obstacles were overcome proactively, efficiently and with full communication, and our deadline was achieved.
- Jason Cantwell, Delta Corporation
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LDC Infrastructure has recently assisted the New Norcia Benedictine Community arrange a lease assignment for the local Optus mobile telephone tower. LDC Infrastructure guided the community through the process and provided all relevant documentation and instructions that enabled the whole process to be completed with minimum fuss.
From the date of submitting the signed documentation [Heads of Terms], full settlement proceeds were received within 21 days. I have no hesitation in recommending LDC Infrastructure, and I'm confident that you will receive the same high standard of service and support as the New Norcia Benedictine Community received.
- Roy Gardner, New Norcia Services
Recently I was approached by LDC Infrastructure to arrange a lease assignment. They guided me through the procedure and provided all the relevant documentation, and full settlement was received quickly and hassle free.
I would have no hesitation in recommending LDC Infrastructure, should you be considering assigning your mobile phone tower lease. I have no doubt that they will deliver the same high standard of work that we have received.
- Brian Craig, Nanaraino Pty Ltd
I’m taking the time to write to you to thank LDC Infrastructure and Harley McKenzie in particular for his work in acquiring [the Telstra least at 21a Sierra Avenue]. Harley was able to assist me in demonstrating the value of the site, give the Vendor comfort that the process was going to be fast and straightforward and then closing the deal out within the timeframe he promised.
The speed and professionalism of this transaction shown by LDC Infrastructure is to be commended and I especially thank Harley for his hard work.
- James Johnston, Knight Frank, Agent for Frasers Property Ltd
Selling the billboard leases to LDC was a fast and pain-free process. They delivered on everything they promised and made sure I was always kept up to date throughout the settlement process.
Before I was approached I never thought I could sell my billboard leases – however I am glad I did and I would highly recommend LDC.
- Director, The MBN Pty Ltd
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Phone: 1300 149 449 | [email protected] | www.ldcinfrastructure.com.au
Why would a property owner sell their lease?
All of our clients are different, but they have one thing in common – better use for the lump sum than the potentially unsecure rent. In the past we have seen clients use the lump sum to get higher returns in real estate, shares or through reinvestment in their business. Additionally, we have seen clients pay down debt, bolster their super or fund a capital purchase.
How does LDC value my site?
There are a number of factors that influence how we value your site. Our analysts will research the other sites in the area, market rent for the area and the risks associated with the particular site. Additionally, we consider specifics to your site such as the fixed annual increases, creditworthiness of the tenant, and annual rent.
The valuation that is provided to you will take into account all of these factors as we determine what rent to expect from the site in the long-term.
Frequently Asked Questions
Would this transaction affect my ability to sell my property?
When the property is sold it is simply sold without the income associated with the lease. Prospective buyers will be aware that the rental rights have been sold – our interest in the lease is registered on title (the format of this registration varies by state and individual transaction.)
Would this transaction affect the value of my property?
Banks, valuers and agents typically attribute negligible value to these assets because the tenant usually has the ability to terminate the lease with 6 months’ notice. They also recognise that unlike a traditional property, if a tenant leaves they will not be swiftly replaced. This impairs potential purchasers of your property as it creates issues with getting financing on their purchase.
Time and time again we see property owners get higher overall net proceeds from selling their property when they sell the lease(s) and property separately. This is validated by the fact that LDC has completed numerous transactions when a property was for sale. In each case the vendor realised that they extract hidden value that a purchaser was not recognizing.
How does a transaction with LDC Infrastructure work?
LDC Infrastructure is a ground lease acquisition company. For a cash lump sum, we buy the lease rights and income stream from property owners who have telecom towers or antennas, billboards, wind turbines, solar farm panels or fiber optic cabling on their property. This transaction does not affect the asset itself. In exchange for the cash payment to the property owner, LDC Infrastructure receives the future rent payments from the tenant.
The LDC TeamLuke CourseVP, Acquisitions
Daniel Francis Director, Acquisitions
Tony Garcia Director, Acquisitions
Harley McKenzie Director, Acquisitions
Brett Macartney Director, Acquisitions
Michael Cohen Director, Acquisitions
Stephanie McManus Director, Closing & Documentation
What are the implications of this transactions on my ability to redevelop my property?
We are always happy to include a redevelopment clause in our closing documents. This would allow you the freedom to redevelop the property as you see fit. Naturally the redevelopment cannot be in breach of LDC's interest in the current lease (which is consistant to your current arrangement).
Under our closing documents we simply require that after the redevelopment the tenant continues to see the site as viable, and the changes do not affect the rent payable under the lease.
What happens if the lease is terminated? Is the lump-sum non-recourse?
When we buy the lease at a site we take the risks associated with termination or decommissioning of the site. This includes the risk of a reduction in rent or lease termination. The lump sum is completely non-recourse – eliminating risk is a driving factor for many of our clients to sell their lease.
Minimizing risk is a driving factor for a lot of our clients to sell their lease. Experts estimate that over 10% of telecom leases have been decommissioned since 2010 due to industry consolidation and the Optus and Vodafone Joint Venture. In the outdoor advertising industry, the bigger risk is rent reductions when leases are renegotiated.
