PROPERTY SEARCHES DURING DUE DILIGENCE

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PROPERTY SEARCHES DURING DUE DILIGENCE

I can safely say that the most important task your solicitor will conduct during the shop purchase process is due diligence, that is to ensure the asset you are buying has no encumbrances, will not be impacted by caveats, zoning changes or future government acquisition. Thorough due diligence is achieved by performing a series of statutory and non-statutory searches on the property you are buying. Each search has a specific use from ensuring the person selling you the property actually owns it, to checking future road widening will not encroach on your property causing it to be acquired by the government. Read more

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Tenants That Don’t Pay

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It would be a nice world if everyone did the right thing at the right time, for retail tenants that means paying their rent on the 1st of every month, like clockwork. Unfortunately we do not live in such a perfect world and you may come across a tenant that has poor cash flow and believes it’s OK to use you as his bank and is regularly late in paying the rent. Read more

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Hairdresser Barber

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As mentioned a few times in Engines of Wealth, I own seven Hairdressing salons and would gladly have more, they make dependable tenants. With that many hairdressing salons in my portfolio I am keen to learn more about their business, so I interviewed a local Hairdresser/Barber to gain greater insight and improve my investment calculations. Read more

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Real Estate Agent

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In Engines of Wealth I discuss at length how to interact with real estate agents from a buyer’s perspective, but when considering them as a tenant and agencies are one of my preferred tenants, there is a twist. When considering the viability of a real estate agent in your shop first you need to ascertain if they are among the 90% that sell residential properties only. Remember the catch-cry “Location, Location, Location”, all areas are not equal and if your shop’s neighbourhood is not providing attractive prices or has too much competition then a real estate agency may struggle. Read more

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Thai Massage Centre

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I recently assisted a fellow investor acquire his first retail shop. We found an ideally priced Thai Massage centre in Maroochydore QLD that was opposite a popular beach and caravan park. The gross rent was $21,350 per annum and the outgoings were $7,220 per annum leaving a net annual rent of $14,130.

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