H & L were referred to The Finders by their property manager as they looked to grow their investment portfolio. We identified an opportunity close to the New Plymouth CBD comprising three residential units on separate cross-lease titles, all available to purchase in a single transaction.

We assessed the combined market value at approximately $1,230,000 and initially negotiated the purchase at 22% below our assessed market value. From there, we coordinated comprehensive due diligence including building inspections, Healthy Homes assessments, methamphetamine testing, insurance, finance, tenancy information and legal review of the cross-lease titles.

The due diligence identified additional maintenance and compliance costs. Rather than simply reporting these back to H & L, we used the findings to renegotiate the purchase price, ultimately improving the deal to 23.4% below our assessed market value.

We also identified longer-term value-add opportunities through renovations, improved rental performance and the potential to investigate converting the cross-lease titles into individual freehold titles.

The Result: Three income-producing properties secured in one transaction at 23.4% below assessed market value, achieving a minimum 7.9% gross rental yield, with immediate equity and further long-term value-add potential.