Join Rethink Commercial Education - Sign up for the 3rd exclusive cohort; ENROL NOW!

Purchased

Perfect warehouse asset!

  • High specification build, fixtures and fittings = High depreciation benefits
  • Annual income: $132,110pa + outs + GST (after management costs)
  • Tenant is an established national insulation supplier since 2012

Purchase Details

Asking Price

$2,350,000

Purchase Price

$2,195,000

Deposit (assuming 70% debt) - 30%

$658,500

Stamp Duty

$104,962.20

Building Report*

$650

Solicitor Costs

$7,500

Valuation

$3,000

Total Cash Required

$774,612.20

Purchase Price + Purchasing Costs

$2,311,112.20

Net Annual Cash Flow Return

$132,110

Net Yield on Property

6.02%

Net Yield Accounting for Purchase Costs

5.72%

Cash-On-Cash Returns

Deposit Needed = 30% + Costs:

$774,612.20

Cost of loan (assume 4.5% pa on 70% debt):

$69,142.50

Return on Equity (pure cash flow return):

8.13%

Return on Equity with a 5% Capital Growth Rate:

22.30%

Return on Equity with a 7% Capital Growth Rate:

27.96%

Return on Equity with a 10% Capital Growth Rate:

36.47%

*approximate numbers

Building Type: Industrial
Building Area: 1,201m2

NLA: 2,142m2
WALE: 3

How we helped this client

This is our client’s first purchase with us. They were not content with the returns they saw in residential, so they looked towards commercial property to build a passive income. Due to their own success in running a successful business, they were a cash buyer, allowing them to act quickly on the right deal. After looking at many deals over six months, we landed this one. They liked the strong return, secure tenant, new warehouse, high depreciation benefits and easy re-lettability. They are now planning on looking for commercial property number two to continue to build on their passive income goals.

More properties

Contact Us