 Asset Class: | Office |
 Price: | $ 1134000 |
 Net Yield: | 6.50 % |
Net Yield - including solar strategy: | % |
 Property Market Status: | Off Market |
<b>Central, High-Exposure, Ground-Level Investment with Ample Parking and 6.5% Starting Net Yield</b><br><br>This strategic ground-floor strata investment is positioned in the heart of Perth’s CBD, offering a highly attractive parking ratio of six exclusive bays, complemented by ample street parking. Spanning 242sqm of lettable space, the property is newly leased to an established health service provider, with the flexibility to accommodate retail use, enhancing its long-term versatility.<br><br>Leased to Avenues Australia Pty Ltd until December 2027, the property generates a strong net rental income of $73,750 per annum plus outgoings and GST, delivering a solid 6.5% net yield. The lease structure ensures that 100% of outgoings, including management fees, are covered by the tenant, with annual CPI-linked increases providing built-in rental growth.<br><br>With high exposure, secure income, and a prime CBD location with generous parking, this property presents an outstanding opportunity for investors seeking stability and attractive returns.<br><br><b>What We Like About This Asset</b><br><br><ul style="list-style-type:disc;list-style-position:inside;padding-inline-start:20px;"><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Versatile use as office (currently) and retail</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">built in 2011 > depreciation benefits</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">modern, clean fitout</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">refurbished office spaces, especially ground level, are increasingly sought-after by buyers and tenants</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">convenient customer street parking in addition to 6 exclusive bays during business hours (exclusive bays are not on title but written into the strata bylaws)</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Attractive starting net yield at 6.5% </span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">base lease rate of $275/sqm suggests rental upside with comparable ground-level units above $300/sqm</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">low car bay rate at $100/bay per month (standard rates $250/bpm for secure parking)</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">fitout (partitioning and fixed cabinetry) transferred to buyer</span></p></li></ul>
How old is the asset?
Vendor's reason for selling?
Days property been on market?
Is this property strata titled?
Are the seller and tenant related parties?
How long has the current tenant been on site?
How long has the tenant been in business?
Is this property in a flood zone?
Is this lease a leaseback arrangement?
<b>The Office Market</b><br><br>Perth's office market is predominantly driven by the resources sector, with significant contributions from mining, energy, and related industries. This focus has led to increased tenant demand and market activity in the Central Business District (CBD). Over the past two years, the Perth CBD has experienced a net absorption of 90,534 square meters, accounting for 4.9% of total stock, making it one of the top performers among major Australian cities.<br><br>In terms of development density, the Perth CBD has seen substantial growth. In the first half of 2024, 39,732 square meters of new office space were added, including notable developments like Capital Square Tower 3 (13,681 square meters) and the refurbishment of QV1 (21,306 square meters). However, this was offset by the withdrawal of 34,513 square meters of older stock, resulting in a net supply increase of 5,219 square meters. Consequently, the vacancy rate rose by 0.8 percentage points to 15.5% during this period.<br><br>Looking ahead, the development pipeline appears limited, with no major completions expected in 2024 and only 32,000 square meters scheduled for 2025. This constrained supply, coupled with sustained tenant demand, is anticipated to reduce vacancy rates to around 10% by 2027.<br><br><b>Lifestyle & Population</b><br><br>Perth offers a high quality of life, blending urban convenience with stunning natural surroundings. The city is known for its pristine beaches, warm climate, vibrant arts scene, and excellent food and wine culture. Residents enjoy access to top-tier healthcare, education, and outdoor recreational activities, making it an attractive destination for families and professionals alike. The relaxed yet dynamic lifestyle, combined with a strong economy driven by the mining and resources sector, continues to draw new residents from across Australia and beyond. <br><br>In recent years, Perth has experienced significant population growth, increasing by 3.65% in 2023, the highest among Australian capital cities. This trend is expected to continue, with projections estimating that Greater Perth's population could reach 2.9 million by 2031 and 3.5 million by 2050. The city's expansion is driven by interstate and international migration, bolstered by job opportunities and affordability compared to Sydney and Melbourne. With strong infrastructure development and urban planning efforts, Perth is well-positioned to accommodate future growth while maintaining its high standard of living.
Additional Location Information File<b>Avenues Australia</b><br><br>Avenues Australia is a for-purpose organisation committed to enhancing the coordination, management, and administration of services for individuals living with complex health conditions, disabilities, long-term mental health conditions, and social circumstances. Our navigational services address the fragmented nature of available health and social services by providing individualised assessments, service planning, case management, coaching, coordination, and financial administration of appropriate support services.<br><br><a style="color:rgb(51, 51, 51);display:inline;" target="_blank" href="https://www.avenuesaustralia.com/"><u>https://www.avenuesaustralia.com/</u></a><span></span>
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Under the leases all outgoings are 100% recoverable, including management fees and land tax.
Additional Financial Information FileInitial Term:
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Rental Comparable (Ground Level) 29/226 Beaufort Street, Perth - 242m2 - $275/m2 + 6 car bays $100/bpm 28/226 Beaufort Street, Perth - 155m2 - $285/m2 + 3 car bays 3/159 Adelaide Tce, East Perth - 349m2 - $366/m2 + 2 car bays $300/bpm GF, 31 Ventnor Avenue, West Perth - 334.8m2 - $443.19/m2 + car bays $325/bpm 1/101 Francis St, Northbridge - 84m2 - $351.19/m2 + 2 car bays $250/bpm Sales Comparable (Ground Level) 29/226 Beaufort Street, Perth - 242m2 - $4,909/m2 8/28 Robinson Avenue, Perth - 54m2 - $5,000/m2 85/118 Adelaide Terrace, East Perth - 94m2 - $5,266/m2
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<b>Purchase Price:</b> $1,134,000 <br><i>(formal offer needs to be presented but agent is confident this will be accepted)</i><br><br><b>Base Rent:</b> $66,550pa + Outg + GST (incl mng)<br><b>Car Bay Income:</b> $7,200pa (6 bays @ $100/bay per month)<br><b>Total Income:</b> $73,750pa + Outg + GST (incl mng)<br><b>Current Net Yield:</b> 6.5% (incl mng)<br><br><b>Allocated Car Bays (Ratio):</b> 6 car bays (1 bay in 40sqm) <br><i>There is an exclusive use statement in the Bylaws that allows the tenant to utilise the car bays Monday to Friday during business hours from 8am - 6pm, Saturday 8am - 2pm.Outside those hours the resident guests can use them (visitor parking). This is how the developers get their DA’s across and get more apartments in the development.</i><br><br><b>NLA:</b> 242sqm (ground floor strata)<br><b>Purchase Rate per sqm:</b> $4,686/sqm<br><b>Net Rent per sqm:</b> $275/sqm (incl mng) + car bays ($100/bay per month)<br><b>100% Outgoings Recoverable: </b>Yes, incl mng<br><b>Outgoings (per sqm): </b>$103/sqm (excl mng)<br><b>Age of Asset:</b> approx. 14 years (2011)<br><b>Any Incentives in the Lease:</b> Yes, 2-months net rent free, tenant pays all outgoings from commencement of lease; full rent payable from 15-Feb 2025<br><b>Are Seller & Tenant Related: </b>No<br><b>Re-letting Period: </b>2-4 months in the current market (high tenant appeal due to modern fitout, high car bay ratio and central location with nearby amenities)<br><b>Flood Zone:</b> No<br><b>Bushfire Zone:</b> No<br><b>Contamination:</b> No<br><br><b>Asset Composition: </b><br><ul style="list-style-type:disc;list-style-position:inside;padding-inline-start:20px;"><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Ground Floor Strata</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">242sqm of NLA</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">6 car bays</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Mix of open place and partitioned offices (transferred to new owner)</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">kitchen included </span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">shared toilets</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Dedicated Reception area</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Meeting room</span></p></li></ul><br><b>Infrastructure Level:</b> Tier 1<br><br><b>Key Highlights:</b><br><ul style="list-style-type:disc;list-style-position:inside;padding-inline-start:20px;"><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Ground Floor Strata</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">242sqm of lettable building area</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">6 allocated, undercover secure car bays (during business hours) + ample street parking</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Built in 2011 > depreciation benefits evident</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Purchase Price $1,134,000 (6.5% net yield)</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Total Current Net Rent $73,750pa + Outg + GST (incl mng)</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Office Rent $65,550pa + Car Park Rent $7,200pa</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Lease Expiry Dec-2027 (no option)</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Annual CPI increases</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">100% of outgoings paid by tenant (incl mng)</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Tenant - Avenues Australia Pty Ltd</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Located in Perth CBD</span></p></li><li style="list-style-image:none;color:rgb(51, 51, 51);"><p style="display:inline;"><span style="color:rgb(51, 51, 51);font-weight:normal;font-style:normal;">Beaufort Street frontage / exposure</span></p></li></ul><br><b>Agent Questions:</b><br><br><b>How old is the building?</b> The strata was lodged in 2011 so work on 2011 built or circa 14 years old<br><b>Who does the fitout belong to?</b> partitioning and fix cabinetry transferred to buyer. Loose furniture belongs to tenant.<br><b>Why is the owner selling?</b> He is a retiring medical specialist and he is getting out of ‘direct property investment’ to have more liquid assets and less headaches<br><b>Is the tenant related to the owner in any way? </b>No<br><b>Are mng and taxes recoverable?</b> All costs recoverable<br><b>Does the property need any maintenance work?</b> No<br><b>Is the floor area 100% council approved?</b> Yes
