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Purchased

Entry level industrial complex

  • Long standing tenants on a 2+2 year lease
  • Purchase price of $465,000
  • Entry level asset

Purchase Details

Asking Price

$500,000

Purchase Price

$465,000

Deposit (assuming 70% debt) - 30%

$139,500

Stamp Duty

$16,000

Building Report*

$500

Solicitor Costs

$1,200

Valuation

3,500

Total Cash Required

$160,700

Purchase Price + Purchasing Costs

$486,200

Net Annual Cash Flow Return

$29,400

Net Yield on Property

6.32%

Net Yield Accounting for Purchase Costs

6.05%

Cash-On-Cash Returns

Deposit Needed = 30% + Costs:

$160,700

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

$9,765

Return on Equity (pure cash flow return):

12.22%

Return on Equity with a 5% Capital Growth Rate:

26.69%

Return on Equity with a 7% Capital Growth Rate:

32.47%

Return on Equity with a 10% Capital Growth Rate:

41.15%

*approximate numbers

Building Type: Industrial Complex
Building Area: NLA: 155m2

Land Area: 200m2
WALE: 2

How we helped this client

Our valued client was a first time commercial investor. They needed our help securing a property that would give them the comfort of easy relatability. We found this perfect off-market industrial asset for them and carried out 100% of the due-diligence. It passed our rigorous process from a numbers, tenant, lease and building point of view. Purchased in a booming industrial market off-market and below market value price, assets like this currently sell for under 6% net so we delighted in securing this asset considering its strength and that of the market.

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