Joint Venture

[OldFart]

Hello,
I am looking for a Debt Partner for an existing three bedroom apartment with private courtyard, separate decking, remote control central heating, secure access and lockup garage at Herbert Street Saint Kilda Victoria. The apartment is across the road from the Saint Kilda Botanic Gardens and a short stroll to Acland Street. The process includes the use of Mezzanine Finance as an investment to improve reveue flows to the JV partners.

I have written up a word document to describe the draft JV process I wanted to propose as a starting point for negotiations. Typically e-mails are always to brief, invariably leave out critical stuff and I wanted to have a professional document I could update and use again and again. The document contains estimates of capital growth, cash flow and returns over the 5 year JV and it lists all of my assumptions.

Last time I spent time in this forum some posters, on slow internet connections, didn't like poeple posting large documents for obvious reasons. So I will mail the document to anyone who is interested enough to request it via email, even if only for educational purposes and will answer any questions related to the JV process I am proposing.

Les. I can mail you a copy for your approval/perusal if you wish. Are you still in Sydney?

Regards
Brenton

 

[Aceyducey]

Oldfart,

What's the ballpark capital injection required & rate of return over the 5 years?

This will help people decide if it fits within their current financial plans.

Cheers,

Aceyducey

 

[peteb]

this is an indication of the area :

21 Herbert St duplex FMR RE AUSD $1,021,000

that sold over the weekend just gone.

not sue of the actual premise details but at least 2bdr probably 3bdr.

 

[OldFart]

Hello,
Thanks for the responses. Without wating to repeat to much of the information in the document.

The property was last valued about 18 months ago at $400,000. Whilst a price of over 1,000,000 for the duplex down the street was a great price but given other sales in the area I think mine would be some where around $500,000. My appartment is at 9 Herbert Street. I would need to do a proper review and get a valuation done for confirmation. Maybe its worth more than I expected.

As a rough summary, given that the JV process listed is draft and up for negotiation the estimated figures show over a 5 year period starting from a value of $400,000 the property would be expected to grow by a total of $238,000 or $119,000 for the debt partner. The debt partner would put up $46,250 over the 5 year period e.g. (expenses - revenues) to get the $119,000 capital gain.

Regards
Brenton

 

[OldFart]

Joint Venture Herbert St ST Kilda

Hello,
I made a small mistake in my previous post. I counted some of the interest payments twice. The re-calculated figures show that after 5 years the joi9nt venture debt partner would expect to have capital growth of $119,000 for a cost of $23,00 (Revenues - Expenses) spread over 5 years.

Regards
Brenton

 

[OldFart]

Hello,
I have also added the oppertunity for the joint venrture debt partner to share in the spare up front equity currently expected to be avaialble in the property.

Regards
Brenton