The Parkfair development – to be sold as a completed turnkey project – will be going on auction at the end of April 2021.
Located along Halt Road in Riverton, Goodwood in Cape Town, the development is a mix of retail (on the ground floor) and residential (four floors above). The upmarket project, located on an erf of 1 246m2, is ideal for student accommodation and it will be completed, with an occupancy certificate in April.
There are 100 apartments with 240 beds (not sectionalised) spread across the four residential floors that span some 930m2 per floor. The 754m2 retail area on the ground floor exists in conjunction with a 175m2 foyer / administration area and a small 48m2 refuse area. The first and second floors have 25 single flats and 1 double each, and the third and fourth have 15 single flats and 9 double flats each.
With a projected income of R1 083 000 from this development per month, this is broken down into R833 000 from the residential rooms and R250 000 from the lettable retail space in addition to other income from add-ons such as ATMs, laundry, and cell phone towers as this is by far the tallest building in the area. Rentals for the retail space are envisaged to be more than R100/m2. It is likely the owner will achieve R150/m2, if space is let to a single tenant, to R350/m2, if a mall concept is incorporated.
“The residential estimates, at R7 000 per month for single flats and R14 000 per month for doubles, are calculated according to prices from the University of the Western Cape’s student accommodation fee structure. The new Aquacor development, which is just 200m from Parkfair, is achieving rentals of R7 360 per month for their flats” comments Tanya Jovanovski, Franchisee of Rawson Auctions in Western Cape.
Projected monthly income could be increased further by increasing the 240 beds to 440 by altering the layout and placing bunk beds in the lounge areas, taking it to R1 768 000 per month.
That being said – ignoring the increased bed count – with a purchase price of R85 000 000 and an estimated annual income of R12 996 000, the buyer can expect a gross yield of 15.3%. With 15% overheads, a net yield of 12.96% is plausible.
In addition, the development comes with a signed lease in hand for R700 000, with a 6% escalation in place. However, this could be cancelled so the new owner can negotiate their own agreement.
“With proven rentals from other nearby developments, this project is a sure-fire investment. The project is also expected to be completed this month with an occupancy certificate; this means the buyer can start student intake this year,” notes Jovanovski.
The property will be going on auction on the 28th of April 2021 at 12:00pm. In keeping with best and safe practice, bidding will be done via Rawson Property Group’s new system, which now has alternative bidding options. Details of which are below.
The reserve price for the property will be R85 000 000 with an expected opening bid of R60 000 000 which will be presented to sellers. However, all offers will be reviewed.
More information on this development can be made available on request to serious buyers.
You can either bid via the phone by calling the Rawson Auction office on 079 980 3457; bid via email by emailing firstname.lastname@example.org; or bid online (for selected properties). The property consultant will explain all bidding options to you pre auction.
If online bidding is an option, you first need to register on www.instantproperty.co.za.
This site has a PDF that you can download to read our auction terms and FICA requirements. Please note a completed registration, your ID and FICA documents will be required per auction. Kindly email these to email@example.com.
Interested parties are requested to submit all offers on the Rawson Auctions standard terms and conditions offer to purchase which is available online, or a copy of which can be obtained by contacting the auctions team on firstname.lastname@example.org or 079 980 3457.
For more information about this property please contact Hans Buys on 082 964 6852. Alternatively, contact Tanya Jovanovski, the principal and auctioneer, at email@example.com or on either 082 411 9599 or 079 980 3457.
Source: Propertywheel.co.za | https://propertywheel.co.za/2021/04/student-accommodation-development-in-cape-town-to-go-on-auction/