What's wrong with this one

The 9.9% is Gross and lease expires 03/12 so only 1.2 years left.

Find out what the strata levies are as I suspect that they will be substantial and as per lease a cost to the purchaser.

Can't say I am overly familiar with the area but you could consider the following generally:

- that gross rent equates to around $500 per square metre which seems high for an office rent. This could be because considerable incentives were offered to the tenant to keep the face rental high but the effective rental low. You may find come lease expiry large incentives would need to be offered to retain or find a new tenant.

- who pays the outgoings?
As Andy said the 9.9% is a gross return. At $75/m2 for outgoings, it would then show a 8.3% net return.

I have a couple of properties for sale / lease in Norwest and Castle Hill Industrial area. That one in particular is quite exxy.

As mentioned the lease is currently at $505/m2 which is quite high. A quick search will uncover rates from as low as $200/m2 net with the average being $270-$300/m2 net the throw on outgoings of $100-$120/m2.

The sale price representsover $5100/m2 which is also on the dear side.

Being a smaller suite you can justify a slightly higher $/m2 rate


Heres a comparison

Lease is $300/m2 (I assume its a net lease at that rate)
Outgoings are $75/m2
Asking price is $4265/m2

And another