Industrial Investment | $5,850,000 | Net Yield: 6.31% | VIC

This 100% leased commercial and industrial freehold presents a compelling example of the diversified, multi-tenanted assets Rethink Investing continues to identify for clients seeking strong cash flow, income security and long-term growth potential.

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The substantial Victorian investment comprises five separate titles, with a total building area of approximately 2,025 square metres across a generous 3,407 square metre landholding. The property generates a net annual cash flow return of $369,246.42, secured by five established tenants operating across a diverse mix of industries, including essential services, trade supplies, digital technology and the not-for-profit sector.

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This spread of tenants provides an important layer of income diversification, reducing the investor's reliance on any single occupier or industry. The established nature of the tenancies further strengthens the investment profile, with average tenant tenure of approximately seven years and several occupiers having remained at the property for more than a decade.

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The investment benefits from recoverable outgoings, including land tax across four of the five tenancies, helping minimise the ongoing operating costs borne by the property owner. Structured annual rental increases ranging from 3% to 3.5% are also embedded across the leases, providing a clear pathway for organic income growth over time.

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All five leases feature three-year terms with further options, demonstrating continued tenant commitment to the asset while providing the investor with multiple independent income streams. Combined with the property's multi-title configuration, this creates additional flexibility and helps strengthen the overall risk profile compared with an investment dependent on a single tenant or tenancy.

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The property is positioned within an established Victorian commercial and industrial market benefiting from continued population growth, business activity and demand for well-located industrial accommodation. Limited availability of comparable assets within the surrounding market further supports the property's long-term investment fundamentals.

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Acquired for $5,850,000, the property delivers a net yield of 6.31%, or 5.99% when accounting for purchasing costs. Total cash required for the acquisition was approximately $2,357,775, including a 35% deposit and associated purchasing costs.‍

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Against an estimated annual cost of debt of $247,162.50, the investment produces approximately $122,083.92 in annual cash flow after mortgage costs, representing a 5.18% return on equity from cash flow alone.

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When potential capital growth is considered alongside the property's cash flow, the investment case becomes even more compelling. Based on modelled capital growth scenarios of 5%, 7% and 10%, the projected return on equity increases to approximately 17.58%, 22.55% and 29.99% respectively.

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‍Beyond the headline yield, the strength of this acquisition lies in the combination of five separate titles, five established tenants, diversified income streams, recoverable outgoings and embedded rental growth. Together, these characteristics provide multiple layers of income security while maintaining the potential for both cash flow and capital growth over the longer term.

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With a purchase price of $5.85 million, a 6.31% net yield and more than $369,000 in annual net income, this acquisition reflects the calibre of multi-tenanted commercial and industrial opportunities Rethink Investing continues to secure for clients across Australia.