This purchase was our first foray into commercial property and it was an opportunity we couldn’t miss. The site occupies a prime corner plot on a busy thoroughfare and is located opposite the suburb’s central shopping centre (Woolworths, BWS, etc) and train station. The tenant has been in place for 10+ years with Australia Post being a commonwealth government owned corporation.

 

The property was purchased on the basis that we could achieve value uplift from the following levers:
 

1. Physical refurbishment including modernisation, fixing of minor known issues.
    

2. Lease improvements. We subsequently negotiated a 5y+5y lease with CPI linked rent increases with the tenant paying all outgoings.
    

3. Utilising potential advertising space on the side / rear of the building given the density of the area.    

 

Furthermore, we obtained a license to operate Postal Lockers and worked with Australia Post to install them at the front of the premises (not shown in the photo) in 2023. We believe this will serve to increase customer loyalty to the site and offers a competitive advantage versus many of the surrounding LPO’s without a license – further enhancing the expected value uplift.

 

There have been no major challenges to the site so far.