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High-yielding commercial asset

This commercial property was recently secured off-market by Rethink Investing’s acquisition team for our client. The investment clears over $184,000 in passive income for the new owner – after 100% of outgoings and 70% of the mortgage costs at the current interest rates.

We helped our valued client secure this fantastic investment fully leased with A-grade tenants, including Suncorp Bank, Queensland Country Bank, The Investment Collective and The BBQ Box. This is our clients’ first purchase with Rethink Investing, and they were looking for a high-yielding asset with a low-risk profile. This asset was perfect as the types of tenants in this building have strong trading histories and have never missed a single payment.

The building will also have significant depreciation benefits due to the building being only nine years old.

Purchase Details
Asking Price
5200000
Purchase Price
4850000
Deposit (assuming
70
% debt)
1455000
Stamp Duty
277073
Building Report*
1500
Solicitor Cost*
7500
Valuation*
4500
Other Fees* (Depreciation
report, bank fees)
Total Cash Required
1745573
Purchase Price + Purchasing Cost
5140573
Net Annual Cash Flow Return
371330
Net Yield on Property
7.66
%
Net Yield Accounting for
Purchasing Costs
7.22
%
Cash-OnCash Returns
Deposit Needed =
% + Costs
1745573
Cost of Loan
(Assume
5.5
% pa on
70
% debt)
186725
Return of Equity
(Pure cash flow return)
10.58
%
Return of Equity with a
5% Capital Growth Rate:
24.47
%
Return of Equity with a
7% Capital Growth Rate:
30.02
%
Return of Equity
10% Capital Growth Rate:
38.36
%
*approximate number

Key Highlights

• Building Area: 990m2

• NLA: 1,771m2

• Modern building built in 2013

• Multiple tenants – national brands

• Annual income: $341,425.75pa net + GST

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