Corporate tenants - urgent advice !!

[888Katone]

Has anyone had experience in leasing their unit to a corporate tenant ?

We own a unit close to Tullamarine Airport and the City - attractive and fairly modern and medium level finishes - 2 bedroom. If we can attract a corporate tenant as opposed to an ordinary tenant we could get this unit to positive cashflow. I'll explain......

The unit is rented at $220pw but we have been advised we could get $300 at end of lease due to current tight market, but if we can get $400pw we will be able to keep it as we will have to sell it due to financial restrictions shortly.

The unit has a garage and 2 carpark spaces located 15-20 mins from CBD Melbourne. The unit is at the back and the back fence opens out onto magnificent parkland.

The difference is only $100pw between us keeping it and having to sell it - is there any way we can squeeze a further $100 from this asset ?????

Not sure if we would get $400pw from renting out the 2 rooms separately because the second room is considerably smaller than the master - however the lounge and kitchen could be considered spacious.

I want to reach this goal of $400 in any way possible - lateral thinking anyone ?

 

[peastman]

Have you thought about furnishing it? We have a furnished unit in Kalgoorlie that is liked by the corporate market. It does get a premium rent, but not quite an extra $100. Another idea would be short term and holiday leasing. I have found http://www.stayz.com.au/ an interesting site which may help.

 

[Raddles]

HI there
also what about leasing the property and the carparks separately? - that can also increase the yield
thanks

 

[Alabex]

I would suggest that furnishing and short term letting are the best options.

HOWEVER - while you will get substanitally more doing holiday letting you need to check if you are allowed to in the block - some councils and strata's wont allow it. And you may be faced with longer vacancies in the down seasons.

Long term fully furnished is a good option, however in my experience you will get a higher turn over of tenants - so more agent letting fees and potentially longer vacancies. A this really is because people only live with someone elses 'stuff' for so long before they go home,or get their own 'stuff'.

 

[chilliaa]

Has anyone had experience in leasing their unit to a corporate tenant ?

We own a unit close to Tullamarine Airport and the City - attractive and fairly modern and medium level finishes - 2 bedroom. If we can attract a corporate tenant as opposed to an ordinary tenant we could get this unit to positive cashflow. I'll explain......

The unit is rented at $220pw but we have been advised we could get $300 at end of lease due to current tight market, but if we can get $400pw we will be able to keep it as we will have to sell it due to financial restrictions shortly.

The unit has a garage and 2 carpark spaces located 15-20 mins from CBD Melbourne. The unit is at the back and the back fence opens out onto magnificent parkland.

The difference is only $100pw between us keeping it and having to sell it - is there any way we can squeeze a further $100 from this asset ?????

Not sure if we would get $400pw from renting out the 2 rooms separately because the second room is considerably smaller than the master - however the lounge and kitchen could be considered spacious.

I want to reach this goal of $400 in any way possible - lateral thinking anyone ?

In regards to corporate tenant, i think your best shot is to talk to any international listed companies or australian major companies within one suburb of your property (maybe THE AGE headquarters). See if they have much demand.
Otherwise i wouldnt give it too much hope, most corporate tenants are looking at the CBD or southbank. You have to put yourself into the view of a corporate tenant. They are probably from outside Melbourne here on a short term secondment. They are not familiar with Melbourne, they will want a fully furnished apartment that is VERY close to their work. They might not even have a car.
Another issue: if the economy slows down, this area of leasing gets hit first (on this i have first hand knowledge, its one area that i use for getting higher rents for my cbd properties).

One other option you have is to check for international colledges or universities near your area. International students offer above market rents, especially on a short term basis (3-6 months). Its a headache managing it and you need to have the knowledge to tap this market, but i know of Chinese property owners that are getting around $800per week for houses in the inner city that would normally rent for around $450 per week. Basically they cram students into the property, by converting any large areas in the property into additional small bedrooms (probably illegally)