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Purchased

Multi-income property!

  • 7 total tenancies, 100% tenanted
  • Currently returning $128,500pa net
  • Annual increases of 3% to 5%

Purchase Details

Asking Price

$2,250,000

Purchase Price

$2,100,000

Deposit (assuming 70% debt) - 30%

$630,000

Stamp Duty

$108,773

Building Report*

$800

Solicitor Costs

$8,500

Valuation

$3,000

Total Cash Required

$751,073

Purchase Price + Purchasing Costs

$2,221,073

Net Annual Cash Flow Return

$128,500

Net Yield on Property

6.12%

Net Yield Accounting for Purchase Costs

5.79%

Cash-On-Cash Returns

Deposit Needed = 30% + Costs:

$751,073

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

$44,100

Return on Equity (pure cash flow return):

11.24%

Return on Equity with a 5% Capital Growth Rate:

25.22%

Return on Equity with a 7% Capital Growth Rate:

30.81%

Return on Equity with a 10% Capital Growth Rate:

39.20%

*approximate numbers

Building Type: Retail
Building Area: 1207m2

NLA: 585m2
WALE: 2

How we helped this client

Our client was looking for a multi-income property to spread out the leasing risk. This 7 x tenancy asset was a good example of a diversified income. The property also has many avenues of value and potentials, such as strata titling, raising rents, increasing the WALE and even a small renovation on parts of the property to lift it to another level.

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