Blackminster JV: 4 apartments in Mindarie WA

Discussion in 'Adding Value' started by westminster, 29th May, 2014.

  1. westminster

    westminster P Plate Developer

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    Blacky and Westminster have combined super powers and in depth knowledge in fork ups to do a project together.

    Mission: get in, get out with minimal dramas (oh mwahahahaha)

    Site: found. Under offer with due diligence clause. Had been for sale for approx 2 years. We got a great discount (listed from $565k and offer accepted at $480k)

    Plans: we have a concept plan to build 4 apartments which are 3 x 2 with marina views. Each apartment is around 120-130sqm. Due to the slope of the block, lower at front, high at back, units 1 & 2 are 2 storey more like townhoues, and 3 & 4 are narrow side by side apartments laying over. Parking is from the rear laneway.

    Due diligence / finance: these clauses are concurrent. We have 21 days left on this. Finance will be a commercial loan

    Costs:

    Very rough at the moment but

    Land $480 plus stamps (let's say $500k)
    Construction turnkey plus all works $1-1.2m
    Total Cost $1.5-1.7m

    Values
    Ultra conservative (15% drop in market) $600k each = $2.4m*
    Conservative (5% drop) $650k each = $2.6m
    Happy as Larry (known sales in area) $700k each = $2.8m
    OMFG (hit target market & market up) $725k each = $2.9m
    OMFG ...............

    * this is the value we are using for all ROI.

    Risks:
    This is a riskier market being so far from Perth. It's more volatile so we are using very conservative figures before proceeding.

    Demographic Target:
    Mindarie is mainly UK and South Africans - almost 66% are non Australian. We are thinking these apartments will appeal that demographic and/or downsizers in the area who want to still have the marina life but not the upkeep. They will also appeal to investors who want to do short term stay lets.


    Views: taken from our next door neighbour

    Our neighbour
    [​IMG]

    Middle floor views

    [​IMG]

    Top Floor View

    [​IMG]

    We hope to get some ocean views too

    [​IMG]
     
    Last edited: 30th May, 2014
    redwing likes this.
  2. Tano

    Tano Member

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    Congratulations and Best of luck to you both. Can't wait to see the concept drawings..
     
  3. Shahin_Afarin

    Shahin_Afarin Finance Broker

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    How come finance is commercial?
     
  4. Shahin_Afarin

    Shahin_Afarin Finance Broker

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    Inside or outside super?
     
  5. westminster

    westminster P Plate Developer

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    So that we don't have to cover holding costs. We both have other projects on the go and this also is one of the simpler ways of doing a JV

    Outside.
     
  6. Shahin_Afarin

    Shahin_Afarin Finance Broker

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    How much to get in? Im sure you don't want 12 people putting in $10k each.
     
  7. Blacky

    Blacky Member

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    Its just the two of us...

    We are trying to keep things simple - so the less people involved the better.

    We should be able to source the finance without the need to fund holding costs ourselves (int cap). In addition given there is only 4 units we shouldn't need any pre-sales.

    The first round of concept drawings have been completed - though need some changes. Initial indications show that we should be within the ball park of our initial estimates. Which is good.

    With WM's history and my history we figure "what else could possibly go wrong". Im going on its a numbers game - the more times you shoot, the sooner you will hit your target.

    So far so good. Here is to smooth sailing :eek:

    Blacky
     
  8. westminster

    westminster P Plate Developer

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    No - ugh! :)
    Blacky and I are 50:50 in the venture. We aren't seeking any others.
     
  9. Kinnon Bell

    Kinnon Bell Member

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    Exciting times!

    What will be happening with the vacant block of land on the waterfront?

    Any chance of the views being built out?
     
  10. westminster

    westminster P Plate Developer

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    Yes there is a chance.
    It is zoned mixed commercial/residential like our block with R100.

    There are no current applications for it under consideration. I believe that there was a concept drawn up for it that didn't go ahead. I don't think the current owners have any pressing desire to develop it.

    So we plan to get in and get out before that happens. It's one of the risks with this site.
     
  11. D.T.

    D.T. Property Lookerafterer

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    Sounds like fun
     
  12. westminster

    westminster P Plate Developer

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    See this is why I know you aren't the same person :)
     
  13. stumpie

    stumpie Member

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    Awesome news Blacky & WM, looking forward to hearing more about this project.
     
  14. Skuttles

    Skuttles Member

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    Interesting site/opportunity! Thanks for sharing WestnBlack, will watch with interest.
     
  15. eyespy

    eyespy Member

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    wow ! sounds very interesting.....looking forward to reading more.
     
  16. Aaron Sice

    Aaron Sice Seldom Seen Kid

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    Cool stuff! Keep it up :)

    Wanneroo are much easier to deal with :)
     
  17. BLTN

    BLTN Member

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    Geez, you don't take a rest for a single minute do you

    Will follow this with interest as well, can't wait to get into developing myself!
     
  18. Brady

    Brady Big 4 Banker

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    Thanks for sharing again keep it coming :)
     
  19. INVSTOR

    INVSTOR O+

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    If only I had a quarter of your energy! :)
     
  20. VaSSagO

    VaSSagO Member

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    Good work!

    If only I could find deals like this :confused: