Debt Leverage Management Policy Template – Unlisted Property Schemes (RG 46)

The Debt Leverage Management Policy Template is a board-approved internal policy setting out how a fund operator borrows, monitors gearing and interest cover, and responds when a financial covenant comes under pressure. It is drafted for an Australian financial services licensee acting as responsible entity of an unlisted managed investment scheme that invests in real estate or direct property assets, and is structured around the ASIC Regulatory Guide 46 benchmarks and disclosure principles.

Use this policy if you:

• hold an AFSL and act as responsible entity of an unlisted managed investment scheme
• operate a fund that invests in real estate or direct property assets
• borrow under facility agreements that contain financial covenants
• need a written gearing policy and interest cover policy at individual credit facility level
• disclose gearing and interest cover to investors in offer documents and fund updates

It is suited to:

• responsible entities of unlisted property schemes offered to retail investors
• compliance officers who own and maintain the policy suite
• boards of directors approving borrowing and leverage settings
• fund managers responsible for facility agreements and covenant monitoring
• investment committees consulted on lender selection

What this policy covers:

• AFSL general obligations under section 912A and responsible entity duties under section 601FC of the Corporations Act 2001 (Cth)
• RG 46 Benchmarks 1, 2 and 3 and Disclosure Principles 1, 2 and 3, mapped section by section
• lender selection guidelines and indicative diversification thresholds by exposure level
• gearing ratio, net gearing ratio and look-through gearing calculations, each with a worked example
• interest cover ratio calculation and the starting position on interest capitalisation
• quarterly covenant review, disclosed target ranges and a nominal 5% escalation buffer
• a covenant monitoring and escalation flowchart, with breach recording in the compliance register
• a key obligations table and an appendix mapping every section to its regulatory source

You receive an editable Word document containing a definitions table, worked calculation examples and a drafting guide that is deleted before adoption, with placeholders for [Company Name], [Company ACN], [AFSL Number], the Board approval date and the location of each related document. The gearing thresholds, timeframes and covenant buffer shown in italics are drafting positions rather than fixed requirements, and a mortgage scheme, credit fund or listed vehicle will need the regulatory references and defined terms adapted. Check the template against the current version of RG 46 and your own facility agreements, and have it tailored to your organisation by a qualified lawyer.