It is possible for a Self-Managed Superannuation Fund (SMSF) to purchase an apartment in the Rina project as an investment.

If the SMSF is able to make the purchase for cash (i.e. with no borrowing), the procedure is the same as any other purchase of real property.

If the Fund wishes to borrow money to purchase the apartment, that is also possible.  However, in this case the transaction will need to be structured in compliance with the Superannuation (Industry) Supervision Act – and in particular with section 67 (4A), which imposes two requirements:

• - the borrowing must be used to acquire an asset (i.e. the apartment) that is held on trust so that the SMSF trustee receives a beneficial interest and a right to acquire the legal ownership through the payment of instalments; and
   
• - the lender's recourse against the trustee in the event of default on the borrowing, or the exercise of rights by the trustee, is limited to rights relating to the apartment.

One way of complying with these requirements is to set up a Debt Installment Trust (DIT).

There are significant and totally lawful income tax and capital gains tax advantages available by investing in the Rina Apartments through an SMSF. However, the required structure is more complex and expensive than an outright purchase without borrowing, and potential investors should seek their own independent advice. Any good Australian lawyer or accountant familiar with superannuation law should be able to assist in this regard.