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Purchased

Medical centre with a long lease

  • Current net rent: $191,695.92 per annum net + GST
  • Lease term: 10 year + 10 year option
  • Depreciation: over $52,000 in depreciation benefits this year!

Purchase Details

Asking Price

$3,600,000

Purchase Price

$3,194,932

Deposit (assuming 70% debt) - 30%

$958,479.60

Stamp Duty

$156,662.19

Building Report*

$1,000

Solicitor Costs

$8,500

Valuation

$4,000

Total Cash Required

$3,365,094.19

Purchase Price + Purchasing Costs

$191,695.92

Net Annual Cash Flow Return

$427,084

Net Yield on Property

6.00%

Net Yield Accounting for Purchase Costs

5.70%

Cash-On-Cash Returns

Deposit Needed = 30% + Costs:

$1,128,641.79

Cost of loan (assume 5.25% pa on 70% debt):

$117,413.75

Return on Equity (pure cash flow return):

6.58%

Return on Equity with a 5% Capital Growth Rate:

20.74%

Return on Equity with a 7% Capital Growth Rate:

26.40%

Return on Equity with a 10% Capital Growth Rate:

32.20%

*approximate numbers

Building Type: Retail
Building Area: 505m2

NLA: 1,102m2
WALE: 5

Rethink Investing’s acquisition team recently secured this commercial property off-market for our valued client. The asset was a strong-performing medical centre with a rare 10+10 year lease.

 

This is our clients’ first property with Rethink Investing. They were looking for a property that would perform in all economic conditions. Our clients wanted a newer building, so they didn’t have to plan for any major maintenance works in the near future. They also liked purchasing this off-market without competing with others in an auction-style environment.

 



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