Keithj,
That's just scratching the surface what you have listed there. There is a massive amount of due diligence that needs to be done before finally signing an unconditional cash contract to buy a property that is multiples in value of most investor's entire portfolio's. Numbers count, and big numbers count even more.
Because this is a numbers game we play, I only look at the numbers. Emotion, general principles, over-arching philosophies, common wisdoms and other fluffy feelings don't come into it.
You ask about LVR's....well it's simply a number. No go.
You ask about interest rates....well it's simply a number. No go.
You ask about other loan conditions....well the important conditions involve a number. No go.
You ask about why it's a good deal....as stated above, simply because of the numbers. No go.
You ask about comparing it to other deals and why I chose this one....as stated above, simply comparing numbers. No go.
The rent is indexed to a floor area - a number. The indexation rate is a number. The future rent escalation rate is a number. The rental review date mechanism is simply a number.
The cashflow amount of the deal I have already foolishly divulged, and been castigated severely for...but oh well. That too was just a number.
The risks of this project has been evaluated through my scaling mechanism and numbers assigned accordingly, pumped through my risk matrix and a number popped out. Viola.
The tenant mix I have already divulged. It was a number. Tenant quality wasn't a number, so I can confirm it was very good. I have however already said they are bigger than Ben-Hur. I also stated lease length - which was also just a number.
Where are we in the cycle, well the cycle is described by a certain number of years, and we are a certain number of years into it. I've divulged this already in another thread. Both are numbers.
What growth is this expected to have ?? Well it all boils down to either a number or a range of numbers. Or would you prefer good or very good. It means nothing without a number.
LPT's - dunno, too busy bashing away doing my thing to worry about them just yet....not enough time in the day to concentrate on them as well. When I get big enough, hope to start my own up, and then get people like you Keithj to buy into my own LPT at highly inflated retail prices, when I've picked them up at vastly reduced wholeslae prices. At that stage, I might show you some numbers.
How will it impact the rest of my portfolio. It'll impact it on both an LVR, cashflow and future growth level - all of which can only be described by numbers.
As I've stated many times before, this game we play is simply a big numbers game. Without the numbers, or introducing some fairy tale numbers, the whole thing is a sham. 43% it's a winner. 5% it's a dud. Plucking numbers out of the air to explain an over-riding principle just makes a mockery of the whole exercise.
We have a blank standard format we use to assess a property. It's a huge big list with a blank in one column where we simply fill in the numbers. Without the numbers, the whole thing is a waste of time from an investment decision p.o.v. Now simply discussing executed deals on an open internet forum with the intent of simply having a chat, whoa back - that's a whole different ball of wax.
Keithj, sorry you didn't get a warm fuzzy feeling about my humble story. Happy for you to elaborate though on your investment journey.
I get the feeling everyone wants more numbers and to be led by the nose every step of the way. This ain't gonna happen.
I'd suggest you buy one of two CIP's and plop down the deal on an open forum and let everyone else tear it to shreds and see how you go. It may be an interesting exercise, and a tad more confronting than sitting on the sidelines.
Enough's enough, I'm going to bug out of here and go play with the kids.
