[Scott No MatesParticipant@scott-no-matesJoin Date: 2005Post Count: 3,856]

September 16, 2016 - 9:28 pm

There’s no point developing an undercooked site – aim for the maximum margin at an acceptable degree of risk. It may be better to sell with a DA than build if you’re risk averse.

What is the zoning, fsr, etc to achieve the maximum number of units on the site?

Selling OTP will assist you with finance however you’re not able to use the deposits towards the land/build costs.

You may pay more for commercial finance maybe 1-1.5% pa (so about $10k on $1m – that’s barely a pimple on a …..).

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September 16, 2016 - 4:02 pm

Contact Archicentre for some suitable architects to prepare DA plans & specs.

Why only 4 units if more units will be more profitable? A more expensive loan won’t make the project unviable. A residential loan will be more restrictive on what you can build and your profit/end values.

Have your designer spec the job not the builder. Builder will spec stuff to maximise their margins not necessarily in your interests.

• This reply was modified 7 years, 7 months ago by  Scott No Mates.

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September 16, 2016 - 3:53 pm

Retailers don’t suddenly go belly up. There are plenty of twll tale signs – rental arrears, lack of stock, decreasing freshness of product, cleaning issues, decreased opening hours, staff reductions etc.

Other mitigations available include director or franchisor guarantees.

Retail leases often have provisions for the reporting of monthly turnover and annual audits – this orovides valuable insights into the business.

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September 16, 2016 - 9:28 am

A bit of a tall ask unless you have the property operating as a business ie. you need to be selling more than the house but also the business entity (this takes out all of the comparable house sales as it’s listed in the business sales with solid turnover, management, advertising, rent, maintenance, goodwill etc as part of the business.

If it is purely an air b&b or stayz proposition, then the barriers to entry are low and the house next door is 50% cheaper.

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September 16, 2016 - 7:40 am

What do you need to learn which isn’t easily converted from residential experience other than rent review methods, termination, make good, AFSS, Gross/nett, incentives & if all else fails 1800-sue-me ie solicitor.

All of these things are freely available on the web, local library or TAFE bookshop.

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September 16, 2016 - 7:31 am

CGU Padlock also has provision for LL insurance, ask your broker.

If you already hold a 3 month bank guarantee or cash bond do you really require additional security?

In over 30 years association with commercial property ($x00,000,000 under management), I have seen very few instances where it may have been useful.

I have inquired but even my broker has not put forward any justification fot it. Money best kept in your pocket.

• This reply was modified 7 years, 7 months ago by  Scott No Mates.

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September 1, 2016 - 10:07 pm

if there are no windows, often these buildings are ‘zero lot lined’ ie built up to the boundary.

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August 8, 2016 - 11:15 pm

@richard31 – there are multiple restrictions around setting up sydnicates (depending upon the number of members, you may need a product disclosure statement and very specific legal advice). You may need to speak to a ‘structuring’ solicitor like @terryw who may advise that you use a unit trust where you can sell a number of units to members.

• This reply was modified 7 years, 8 months ago by  Scott No Mates.

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August 8, 2016 - 11:06 pm

The Master Builders Assoc of NSW holds regular one day seminars – called Keys to Property Development. These are held in Sydney, Newcastle, Ballina & South Coast IIRC. Linky

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July 24, 2016 - 10:51 pm

Difficulty of finance, higher turnover of tenants

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July 6, 2016 - 2:36 pm

$400, really? What’s it going to cost to replace a tenant – letting fee, advertising and vacancy?

Just because you’d not had issues doesn’t mean that everything will last forever whether it be electrical, structural, waterproofing or whatever.

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July 6, 2016 - 2:20 pm

@zen007 – if the trust isn’t in existence when you enter into the contract you may have to pay double stamp duty. @terryw

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June 28, 2016 - 10:22 pm

as @benny notes – UCV is for ratings purposes, it is not based on a physical inspection of the property but is a statistically modified bulk valuation methodology which has been used. It does not reflect your reality, you can dispute it if you believe it is too low but do you want to pay land tax (if it isn’t a ppor)?

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June 28, 2016 - 10:11 pm

@nickyd – I’ll second @cjaysa‘s recommendation. Dave is both an investor and a BA. Heavily invested in the Adelaide & Sydney markets. Very personable guy.

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June 27, 2016 - 8:59 pm

Terryw wrote:

Each would pay tax

How would you determine the cost base? (especially if most of the units had changed hands several times). I would lean on the presumption that the CP had been established at day 1 of the subdivision and has not changed ownership though the members of the body corporate may have changed (possibly more than 100%).

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June 27, 2016 - 12:18 pm

Sales is a long slow road to success. You don’t just walk into listings – it takes years to build your network of contacts (it takes people years to decide to sell or minutes). Pay is basic wage, commission is on top but you must pay your employer back your wage in many cases- they don’t pay for your training etc for nothing.

Although your passion may not be there at present with being a sparky, there is definitely good money to be made once qualified.

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June 27, 2016 - 12:13 pm

Bills board factory

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June 26, 2016 - 10:40 pm

@mcpatching – there’s always lots of hype for what Commonwealth Games or the Olympics bring to a city. How long did it take for the area around the last Brisbane games take to get off the ground?

Whereabouts is the bew games being held specifically?

Homebush precinct for commercial still hasn’t hit its straps 16 years on and it is well located on one of the most toxic bays in the world.

4% net on existing industrial is pretty crook (very high value compared to rents – is the land prime for redevelopment or rezoning?

Buying older industrial for redevelopment can be worthwhile but be wary of functionality of the space – modern warehousing requires high roof, container access etc to maximise utility. Eg SW Sydney rents are 10-20% lower for older buildings as the volume of space is smaller compared with new buildings.

• This reply was modified 7 years, 10 months ago by  Scott No Mates.

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June 26, 2016 - 10:17 pm

Great question @blackhotel

Even though the units may have changed ownership since inception the common property is owned by the owners of the strata plan not by individuals. Specialist tax and legal advice should be sought as there will need to be a new SP lodged which will be subject to cgt at some time in the future should any furthwr subdivision of common property be achieved.

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June 26, 2016 - 10:11 pm

Generally no land tax threshold applies: http://www.osr.nsw.gov.au/taxes/land/factsheet/trusts