4 bed HMO
Windle Hall Drive, St. Helens WA10 6PY
Project
Background
& Deal Structure
A 4 bedroom terraced property requiring modernisation, ideally suited for conversion into a 4 bedroom house of multiple occupancy (HMO) and leased to a Registered Provider on a long-term commercial lease.
The Registered Provider (RP) have expressed interest in this property, and it has passed their postcode checks.
The RP have offered a 10 year lease on this unit, following renovation and having onboarded the property.
Location
Area
Located close to the centre of town, with an abundance of local amenities and facilities, a short distance to the train station and motorway networks providing access to Liverpool, Manchester and beyond, St. Helens is well located.
The property is perfectly positioned for access into the town, is in close proximity to many local, national and global employers, and benefits from a variety of local recreation spots including local golf courses, parks and forests.
Images
Floorplan
Project
Scope of Works
Rip out, door casings, kitchen, bathroom fittings etc as required, carpets as required.
Install smoke & heat detection, interlinked smoke detection to all rooms and corridors and 1 heat detector in the kitchen area. Full rewire of electrical sockets, lights and extraction, new consumer unit EICR test and two EML fittings Kitchen and Bathrooms to have Bulk Head lights. All bedrooms to have 1 no USB Socket and minimum 2 double sockets Communal area to have 1 USB Socket and minimum if 3 double sockets in total Kitchen to have isolation switch for washing machine. Bathrooms x 2 to have extraction fans.
Supply and fit new fully compliant FD30 fire door casings, fully compliant FD30 fire doors, intumescent fire strips, architraves, fire door closer, push plate to the communal door, fully compliant door lock suitable to specific fire door, doorstop to all rooms.
Reuse kitchen carcass. Budget to replace door front and worktops.
Reuse bathroom with budget to replace bath and improve splashback areas.
Carry out all associated joinery works throughout the property to make good existing woodwork, skirting boards etc.
Install front and back door c/w thumbturn locks.
Install new Combi boiler and Gas Safe Cert.
Fire-board under stairs and to any supply cupboards etc.
New flooring where required, look to save part of existing floors where possible.
Option for full redecoration of all walls, ceilings and woodwork in white throughout the whole house.
Financials
Acquisition Costs
Purchase Price Sale agreed | £105,000 |
Renovation Refurbishment & Conversion Costs | £34,500 |
Architect Budget for plans drafting plans and submission to local authority | £650 |
Furniture Furnishing to provider’s requirements | £3,000 |
SDLT Stamp Duty Land Tax | £3,150 UK £5,250 INT |
Survey RICS Level 2 report | £420 |
Legals Conveyancing & transaction fees & disbursements | £1,500 |
Sourcing Sourcing Fee | £5,000 |
Capital In Total acquisition costs | £153,220 |
Optional Extras
Project Management @10% of cost of works | £3,450 |
Lease Setup Lease negotiations & contract admin with Registered Provider | £800 |
Post-Works Refinance
Gross Development Value Bricks & mortar valuation | £140,000 |
Uplift Between GDV and original purchase price | £35,000 |
1st Charge Lending @75.00% of GDV – recycling funds onto next opportunity | £105,000 |
Capital Left In Capital remaining in equity post-refinance using mortgage lending | £48,220 |
Registered Provider 10 Year Lease
Gross Rent p.a. Negotiated rate for area | £14,144 |
Mortgage p.a. @6.00% lending @75%LTV | £6,300 |
Operational Expenses p.a. @0.00% | £0 |
Management p.a. 0.00% | £0 |
Net Cash Flow p.a. Pre-tax income | £7,844 |
Capital Growth
Capital Gain
Capital Value @ Year 10 Year 10 value assumed conservative 3.5% annual growth | £197,484 |
Mortgage Lending 1st Charge lending redemption | £105,000 |
Equity Investment Capital Capital returned to equity investor | £48,220 |
Capital Gain @ Year 10 Cap.value less 1st charge lending & equity investor’s capital | £44,264 |
Investor Returns
Income & Return
Net Cash Flow PA Annual net income after costs | £7,844 |
Total Net Lifetime Cash Flow Net income over life of lease term | £78,440 |
Total Lifetime Return on Capital Gain + Total Income (calculated @Year 10) | £122,704 |
Comparables
Availability
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This deal is available under our standard terms with a 25% downpayment of the Sourcing Fee paid to secure the opportunity, deductible from the final balance due at Exchange of contracts.
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