- Purchased in 2019 for $1.1M in a strong south west regional centre of WA.
- Net rent was 114k with an additional turnover provision and 4 years remaining on a 10 year lease.
- This was a yield of 10.36% which is much higher than other fast food drive through properties, and much higher than other commercial properties in the town.
- Free cash flow was ~ $70k p.a. based on 80% LVR with 5% interest rate at the time.
- Total equity invested (including costs) at the time was ~ 275k, indicating a return on equity of 25% at the time.
Acquisition Details
Purchase Details
Purchase Price
$1,100,000
Net Rent
$114,000
Net Yield
10.4%
Financing
Borrowing
80%
$880,000
Deposit
20%
$220,000
Acquisition Costs
5%
$55,000
Total Funds Required
$275,000
Free Cash Flow
Net Rent
$114,000
Interest Expense
5%
$44,000
Free Cash Flow
$70,000
Return on Cash Invested
25%
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