Aqua Coldharbour Partnership LLP 6
This was the third of our more adventurous non-pension partnerships, designed to achieve strong capital growth. Purchased in October 2007 this was designed to take advantage of opportunities in the commercial property market.
The partnership exchanged very quickly on two freehold office buildings on the same commercial estate in Sherborne Dorset. Unit 1 was almost 17,000 sq ft built 7 years ago and let to the MOD with 4 years remaining on the lease. The purchase price was £1.4 million and the rent a healthy £ 131,500 per annum.
Unit 4 was let to the NHS Trust as a day centre, although the lease was about to expire. The rent was £34,000 and the purchase price £500,000. The unit had been built 10 years ago. The owner sold both units to the partnership.
The main gain to be made from these units was the fact that they were both seriously under rented at £7-8 per square foot. There is lots of evidence that £11-12 is the market level, or more! This allows for strong expected gains and the new lease has been agreed with the NHS trust for a term of 10 years and a rent of £54,000 per annum - a very satisfactory increase.
The expected term of this investment is 6 years.
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