2 bed family-let

Moorland Road, Birkenhead

Project

Background
& Deal Structure

A 2 bedroom mid-terraced property requiring modernisation, ideally suited for leasing to a Registered Provider on a long-term commercial lease.

We have an established relationship with a Registered Provider (RP) who expressed interest in this property, after passing all their criteria checks.

The RP 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, Chester and beyond, Birkenhead 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

Before & During

Floorplans

Scope of Works

  • Full rewire inc. smokes
  • New bolier
  • Kitchen touch-ups
  • Towel rail in bathroom required
  • Fascia and gutter possible replacement
  • Joinery: board up spindles on stairs
  • Skylight glazing between bathroom and back bedroom will need to be replaced with toughened glass
  • Saw down buddleia plant in yard (and treat)
  • Jet spray yard
  • Paint rear yard walls
  • Decorate throughout
  • Carpets required stairs & landing

Financials

Acquisition Costs

Purchase Price
Sale agreed		£65,000
Renovation
Refurbishment & Conversion Costs		£15,000
Furniture
Furnishing to provider’s requirements		£2,000
SDLT
Stamp Duty Land Tax		£1,950 UK
£3,250 INT
Survey
RICS Level 2 report		£420
Legals
Conveyancing & transaction fees & disbursements		£1,500
Sourcing
Sourcing Fee		£3,000
Capital In
Total acquisition costs		£88,870

Post-Works Refinance

Gross Development Value
Bricks & mortar valuation		£85,000
Uplift
Between GDV and original purchase price		£20,000
1st Charge Lending
@75.00% of GDV – recycling funds onto next opportunity		£63,750
Capital Left In
Capital remaining in equity post-refinance using mortgage lending		£25,120

Registered Provider 10 Year Lease

Gross Rent p.a.
Negotiated rate for area		£6,741
Mortgage p.a.
@6.00% lending @75%LTV		£3,825
Operational Expenses p.a.
@0.00%		£0
Management p.a.
0.00%		£0
Net Cash Flow p.a.
Pre-tax income		£2,916

Capital Growth

Capital Gain

Capital Value @ Year 10
Year 10 value assumed conservative 3.5% annual growth		£119,901
Mortgage Lending
1st Charge lending redemption		£63,750
Equity Investment Capital
Capital returned to equity investor		£25,120
Capital Gain @ Year 10
Cap.value less 1st charge lending & equity investor’s capital		£31,031

Investor Returns

Income & Return

Net Cash Flow PA
Annual net income after costs		£2,916
Total Net Lifetime Cash Flow
Net income over life of lease term		£29,160
Total Lifetime Return on Capital
Gain + Total Income (calculated @Year 10)		£60,191

11.61%

Annualised ROI %

239.61%

Lifetime Return %

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