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SMSF Business Real Property Lending — Credit Assistance Only

SMSF loans over business real property — facilitation only, on your adviser's recommendation.

We arrange Limited Recourse Borrowing Arrangement (LRBA) loans over business real property for clients whose licensed financial adviser has already recommended it and whose SMSF is established. Neither we nor the lender provides advice on your SMSF structure, the suitability of the investment for your fund, or whether an SMSF is appropriate for you. That advice can only come from a licensed financial adviser.

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The threshold question

What counts as business real property.

Borrowing inside a fund turns on this definition. Under section 66 of the Superannuation Industry (Supervision) Act 1993, business real property means a freehold or leasehold interest in real property that is used wholly and exclusively in one or more businesses. Commercial premises generally meet that test — warehouses and industrial units, shopfronts, offices, consulting suites and childcare centres among them.

What the test asks

  • Is the property used wholly and exclusively in one or more businesses
  • Is the lease on arm’s length terms and in writing
  • Is rent set at genuine market rate, supported by evidence
  • Is that rent actually paid, on time, every time
  • Are rent reviews carried out when the lease says they are
  • Does the business use continue for as long as the fund holds it

Where it is decided

The ATO describes “wholly and exclusively” as an onerous test, accommodating only minor or insignificant non-business use. Whether a particular premises meets it is a question for your SMSF accountant and licensed adviser, on the facts of that property.

We do not make that assessment. We are credit-licensed, not financial-advice licensed. We arrange the loan once your adviser team has confirmed the property qualifies and has recommended the acquisition. Nothing on this page is a recommendation, and it does not take your objectives, financial situation or needs into account.

Before you approach us

What needs to be in place before we can act.

SMSF lending over business real property sits inside a tightly regulated framework. We are credit-licensed, not financial-advice licensed. To engage us for an LRBA loan, each of the following must already be in place — arranged by your own licensed advisers. We cannot put any of these in place for you, and we cannot proceed without them.

①

Personal financial advice from a licensed adviser

A licensed financial adviser must have recommended acquiring business real property in your SMSF for your circumstances and documented that recommendation (typically in a Statement of Advice). We do not provide this advice and cannot proceed without it.

②

Established, compliant SMSF

Your SMSF must already be established, with a trust deed that permits LRBAs and an appropriate trustee structure in place. Your SMSF accountant confirms this — we do not draft deeds, establish funds, or assess SMSF compliance.

③

Bare trust prepared by your solicitor

A separate bare (custodian) trust with a corporate custodian trustee must be drafted by your solicitor before the property contract is signed. We coordinate with your solicitor on lender requirements but we do not draft trust documents.

Scope of our role

What we do — and what neither we nor the lender does.

We are mortgage brokers providing credit assistance under the National Consumer Credit Protection Act. The lender's role is to assess and provide credit. Neither role includes advice on your SMSF strategy or structure — that is regulated financial advice and sits exclusively with your licensed financial adviser.

What we do

  • Identify a lender whose credit policy can accept your existing fund structure and asset
  • Lodge and manage the LRBA loan application end to end
  • Liaise with your solicitor on the bare-trust documentation the lender requires
  • Coordinate directly with your financial adviser, accountant and solicitor through to settlement
  • Arrange refinancing of an existing LRBA where your adviser has recommended it
  • Disclose all fees, commissions and any conflicts of interest to you in writing

What we do NOT do — and the lender does NOT do either

  • Advise on whether an SMSF is appropriate for you
  • Advise on whether acquiring business real property in your SMSF suits your circumstances
  • Establish SMSFs, draft trust deeds, or amend SMSF deeds
  • Assess sole-purpose-test, contribution-cap or related-party compliance
  • Determine whether a particular premises meets the business real property test
  • Provide tax advice or advise on asset allocation within the fund
  • Refer you to a particular financial adviser, accountant or solicitor to put a strategy in place

The lender's role is credit assessment only. Lenders that participate in SMSF lending assess whether the loan can be serviced and the security accepted — they do not approve, endorse, or sanity-check your SMSF strategy, fund structure, deed, or compliance position. Those remain the sole responsibility of your licensed adviser team.

2004
Established
50+
Lender Panel

How we work with your adviser team

Once the prerequisites above are in place, our job is to lodge and manage the loan. We work with a small group of lenders that actively participates in SMSF lending, and we keep your financial adviser, accountant and solicitor in the loop through the application so the loan settles correctly against the structure they have set up.

We do not redirect, second-guess, or substitute for the advice your team has given you. If a credit issue surfaces during the loan application that has structural or compliance implications, we raise it with your adviser team — we do not attempt to resolve it ourselves.

SMSF business real property lending structure illustration

Important — personal financial advice is required

This page is not a recommendation to set up an SMSF or to borrow inside one. We do not provide financial product advice. SMSFs are not appropriate for everyone, can carry significant costs and risks, and may not produce a better outcome than holding the premises outside super.

If you do not currently have a licensed financial adviser, please obtain personal advice from one before approaching us about an SMSF loan. We cannot recommend an adviser to you and we cannot proceed with a loan application until that advice is in place.

Has your adviser recommended business real property in your SMSF?

If your licensed financial adviser has recommended acquiring business real property in your fund and your SMSF is in a position to borrow, book a call and we'll take you and your adviser team through the commercial LRBA loan process.

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Finance on the Coast provides credit assistance only. We do not provide financial product advice. Personal financial advice on SMSFs and on acquiring business real property within them must be obtained from a licensed financial adviser.