How much does it cost to set up and run your first SPV?
Special purpose vehicles (SPVs) are everywhere in Australian private markets. Most property syndicates are SPVs. Most direct lending deals run through SPVs. VC and PE managers use SPVs for follow-on investments and co-investment opportunities. They are usually faster and cheaper to set up than a full fund, and offer cleaner deal economics for investors who want exposure to one specific opportunity.
This guide walks through the realistic cost of setting up and running a single SPV in Australia.
What we mean by an SPV
In this guide we are specifically talking about a single-asset unit trust: a unit trust set up to hold one specific investment, with investors taking units in proportion to their contribution. SPVs are most common in three contexts: property syndicates, credit deals, and VC/PE follow-on or co-investment vehicles.
Note: a single-asset unit trust offered to wholesale investors will typically still be an unregistered managed investment scheme under the Corporations Act, with the same wholesale investor and trustee requirements as a fund.
One-off setup costs
Setting up a single-asset SPV is meaningfully cheaper than setting up a full wholesale fund, but it is not negligible.
| Cost item | Low | High |
|---|---|---|
| Legal | $10,000 | $30,000 |
| Tax advice | $3,000 | $10,000 |
| Trustee establishment | $3,000 | $10,000 |
| Administration setup | $1,500 | $5,000 |
| Other (ASIC, ABN/TFN, AML/KYC, banking) | $3,000 | $8,000 |
| Indicative total | $20,500 | $63,000 |
Deal-specific due diligence costs (property valuations, building reports, credit due diligence) are excluded as they vary significantly by deal type and size.
Ongoing annual costs
Ongoing costs for an SPV are lower than for a fund, but they accumulate every year the vehicle is in operation. For an SPV with a three to five year life, the ongoing cost over its life is often a significant multiple of the setup cost.
| Cost item | Low | High |
|---|---|---|
| Licensing (CAR pathway, ongoing) | $10,000 | $30,000 |
| Trustee fees | $10,000 | $25,000 |
| Administration | $8,000 | $25,000 |
| Audit | $5,000 | $15,000 |
| Tax compliance | $3,000 | $10,000 |
| Insurance | $3,000 | $10,000 |
| Indicative total | $39,000 | $115,000 |
When an SPV is the right answer
SPVs work well when you have one specific deal to raise capital for, the deal economics can absorb the fixed costs, investors want deal-specific exposure, and speed to market matters. SPVs become inefficient when you are doing multiple deals per year, investors prefer diversified exposure, or you want a permanent vehicle to build a track record.
Working with FundPro
FundPro provides licensing, trustee and fund administration services for single-asset SPVs across property, private credit and venture capital deals in Australia. Our directors James Watson and Jonathan Raymond personally manage each engagement and can move quickly when a deal is on a tight closing timeline. Get in touch at info@fundpro.com.au.
This article provides general information only and does not constitute legal, tax or financial advice.