A note for my readers – this investment opportunity got fully booked within 7-8 days – in case you are interested in such opportunities for passive rental income in commercial real estate – please do write to me at firstname.lastname@example.org and I will keep you posted as and when another such opportunity comes up.
Friends – Here is one more good investing opportunity in commercial office space. The details are as follows:
- Investment required for participating in this opportunity – Rs 25 lacs or more (You can combine with friends and relatives if the amount seems large).
- Your will be owning part of a company proportionate to your investment (through shares in this company) which will own this commercial office space property.
- The property is the 15th floor in Phoenix Aquila – a brand new office complex in the Financial district in Hyderabad – the total floor space is appx 47000 q ft and it is coming at just below Rs 10,000 psft. My checks in that location tells me that the prices in that area is in the same range.
- The property location is good – it is in the financial district in Hyderabad – not very far from ISB and has Google, Amazon, Apple, Microsoft, Honeywell, DBS, Cognizant, ICICI, Wipro among others in the same neighbourhood.
- This property is in SEZ zone – hence there are no issues about land titles and there is no stamp duty as well.
- The tenant is UBS – a Swiss financial services company and they have already leased three floors in the property w.e.f March 2020 (one of which is up for sale that we are investing in).
- The lease is for 9 years (with a lock in till Oct 2023) with a 15% rent escalation once every three years.
- There is high confidence that this property price will appreciate over the years as this location is central and well connected.
- The rental returns after management fees and property taxes is appx 7%. Beyond this there will be capital appreciation – which will be surely more than 5% per annum.
- Even though there is this issue of offices going off leases due to work from home phenomenon, I believe that the best properties will always be in demand and this property will be in that category. The main risk is not that the property will not earn a rental – but that the rents in area do not go up due to Work from Home. Even then, I believe that the current rental yield of 7% will at least be there.
- I want to share that I am not investing here (as I do not need any more passive income) – however, if you are building your passive income streams – this is surely a good option.
In case you are interested, please write to me at email@example.com and I will send you the details and connect you to the company front ending this deal as well.