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Purchased
Large industrial asset
This is our clients fourth purchase with Rethink Investing. (They had already purchased a medical centre, office building and a dual income industrial asset with us). This South Australian asset was attractive due to there being no requirement to pay stamp duty. Plus this one had development upside as there is a 7,405m2 block with only 24% site coverage. So for this experienced investor this was an attractive long-term proposition.
Purchase Details
Asking Price
2950000
Purchase Price
2764662
Deposit (assuming
70
% debt)
829398
Stamp Duty
0
Building Report*
1000
Solicitor Cost*
8000
Valuation*
4000
Other Costs*
Other Fees* (Depreciation
report, bank fees)
report, bank fees)
2950000
Total Cash Required
842398
Purchase Price + Purchasing Cost
2777662
Net Annual Cash Flow Return
154500
Net Yield on Property
5.59
%
Net Yield Accounting for
Purchasing Costs
Purchasing Costs
5.56
%
Cash-OnCash Returns
Deposit Needed =
% + Costs
842398
Cost of Loan
(Assume
3
% pa on
70
% debt)
71881
Return of Equity
(Pure cash flow return)
9.81
%
Return of Equity with a
5% Capital Growth Rate:
26.22
%
Return of Equity with a
7% Capital Growth Rate:
32.78
%
Return of Equity
10% Capital Growth Rate:
42.63
%
*approximate number
Key Highlights
• Building Area: 1,804m2
• NLA: 7,405m2• 5+5+5 year lease
• Opportunity to develop the extensive site area
• Annual income of $154,500 pa + outs + GST
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