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Purchased

Established and successful recession proof KFC​ investment

  • Annual Net Rental: $199,000
  • 5+5+5 year lease
  • 1718m2 of freehold industrial land

Purchase Details

Asking Price

N/A

Purchase Price

$3,705,000

Deposit (assuming 70% debt) - 30%

$1,111,500

Stamp Duty

$197,000

Building Report*

$700

Solicitor Costs

$5000

Valuation

$3,000

Total Cash Required

$1,317,200

Purchase Price + Purchasing Costs

$3,910,700

Net Annual Cash Flow Return

$199,000

Net Yield on Property

5.37%

Net Yield Accounting for Purchase Costs

5.09%

Cash-On-Cash Returns

Deposit Needed = 30% + Costs:

$1,317,200

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

$77,805

Return on Equity (pure cash flow return):

9.20%

Return on Equity with a 5% Capital Growth Rate:

23.26%

Return on Equity with a 7% Capital Growth Rate:

28.89%

Return on Equity with a 10% Capital Growth Rate:

37.33%

*approximate numbers

Building Type: Retail
Building Area: N/A

Land Area: 1718m2
WALE: N/A

How we helped this client

This is our clients second purchase through Rethink Investing. This recession proof asset was the perfect addition to their portfolio, which included residential and industrial assets. At a 5.4% net return, this was a particularly good purchase considering the type of tenant. KFC’s are rarely sold at yields this high anymore.

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