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Purchased

Solid industrial asset with long term business

  • 5 year lease
  • No stamp duty as this is in the ACT
  • High growth area

Purchase Details

Asking Price

$1,100,000

Purchase Price

$980,000

Deposit (assuming 70% debt) - 30%

$294,000

Stamp Duty

$0

Building Report*

$700

Solicitor Costs

$4,000

Valuation

$2,000

Total Cash Required

$300,700

Purchase Price + Purchasing Costs

$986,700

Net Annual Cash Flow Return

$70,585

Net Yield on Property

7.20%

Net Yield Accounting for Purchase Costs

7.15%

Cash-On-Cash Returns

Deposit Needed = 30% + Costs:

$300,700

Cost of loan (assume 3% pa on 70% debt):

$20,580

Return on Equity (pure cash flow return):

16.63%

Return on Equity with a 5% Capital Growth Rate:

32.92%

Return on Equity with a 7% Capital Growth Rate:

39.44%

Return on Equity with a 10% Capital Growth Rate:

49.22%

*approximate numbers

Building Type: Industrial Asset
Building Area: 458m2

Land Area: 458m2
WALE: 5

How we helped this client

Our valued client was purchasing their first ever commercial property. They needed a long lease and a high yield. This investment was perfect for their needs as it represented a secure high income. The stamp duty savings was also a bonus which allowed them to stretch the purchasing budget a little higher than they initially planned.

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