All Topics / General Property / My 1st Commercial Property

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  • Profile photo of diamonddaynediamonddayne
    Member
    @diamonddayne
    Join Date: 2004
    Post Count: 13

    Just purchased my first commercial property. Hoping forum members can provide feedback (constructive please)

    Purchase Price $215,000 + SD + Costs
    Rent $15,700 (increasing 3% annually)
    All outgoings paid by tenant
    Lease expiry Jan 06
    Based in Melb.city – multi storey building
    no Car Parking unfortunately
    Building tenanted by listed co.

    My only concern is future tenancy but even that seems reasonably positive.

    Have I missed the boat?[

    Profile photo of yackyack
    Member
    @yack
    Join Date: 2003
    Post Count: 1,206

    What boat are you talking about?

    Profile photo of diamonddaynediamonddayne
    Member
    @diamonddayne
    Join Date: 2004
    Post Count: 13

    The SS Minnow? Tuggy the Tug boat?
    What I was referring to is: I think it’s a good deal but perhaps I’m a little naive and there were some catches.
    What do you think?

    Profile photo of RoofarmerRoofarmer
    Member
    @roofarmer
    Join Date: 2003
    Post Count: 63

    I must admit I have never bought commercial property but shouldn’t the returns on commercial be up above 10% for the added risks you are taking on. By my calculations you are only achieving a little over 7%

    “Most people operate under a false ceiling which is 3 feet high” Stuart G Goldsmith

    Profile photo of yackyack
    Member
    @yack
    Join Date: 2003
    Post Count: 1,206

    You only wanted constructive comments so I was not sure how you would react to my comments.

    1. Are you happy with yield?
    2. No Car Parking unfortunately – that worries me a little.

    So I dont know if you have missed the boat or not.

    Profile photo of diamonddaynediamonddayne
    Member
    @diamonddayne
    Join Date: 2004
    Post Count: 13

    10% return would have been great but with this particular type of risk would have been near impossible to get. I was probably not looking at a cash flow+ situation but more for a mixture -very low from a negative gearing perspective and also room for Capital gain.

    Profile photo of Most excellentMost excellent
    Member
    @most-excellent
    Join Date: 2003
    Post Count: 100

    Depends on many variables :
    product/contract, neighbours, market interests ( type of building what it has to offer )

    costs can be high = high tax deduction

    can use this if one has other trusts/companies etc.. to help each other along.

    Long term goal is prob the real winner here !

Viewing 7 posts - 1 through 7 (of 7 total)

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