Property Acquistion

rmc yandina off market acquisition image of property close up

Investors quick to grab a slice of rare industrial land in Yandina
Investors quick to grab a slice of rare industrial land in Yandina 2048 1228 j23HWa0ZBIED

Investors have been quick to snap up their share of a parcel of prime industrial land in Yandina, as property experts warn of supply tightening rapidly amid fears the region might run out of available stock within a few years.

The site – a 5,144sqm allotment on Central Park Road, near the entrance to the Yandina Industrial Park – was offered to investors by Sunshine Coast-based RM Capital, the investment arm of Rafter Myers, with plans to develop 11 smaller-sized industrial lots.

RM Capital, which has been highly active in recent months developing value-driven property investments in the region, paid $3.85 million for the site off-market, and settled on the site mid-June.

The RMC Yandina Fund, established to allow investors to become partners in the enterprise, was quickly over-subscribed, and a code assessable Development Application will be lodged with Sunshine Coast Council to redevelop the site.

RM Capital’s goal is to establish 11 industrial lots, market the properties, and sell them to owner-occupiers and investors over the next two years. The Fund forecasts a total return of about 68%, with a projected annual Internal Rate of Return of 20%.

RM Capital director Remi Rafter said there were few, if any, opportunities to develop industrial sites in Yandina. “This is a key corner site – one of the best in Yandina,” he said.

aerial overhead image of yandina property acquired

The site is three minutes from Yandina’s town centre, 30 minutes from Noosa and 80 minutes from Brisbane. It is located within a tightly held industrial park and has direct access to the Bruce Highway, Queensland’s major road linking Brisbane with the state’s northern coastal cities.

Currently, it houses an older-style warehouse and several vacant buildings, all of which will be demolished to make way for the new development. It is serviced by a sealed dual carriageway, which carries minimal traffic.

With strong demand from local trades, construction and service businesses, Mr Rafter is confident the lots will be popular with investors and traders seeking smaller-format strata units.

Yandina, once predicted to become the Sunshine Coast’s major centre, was the first town to be settled in a region that is now one of the fastest-growing in Australia.

The Sunshine Coast is the leading destination for internal migration in the country, fuelling spectacular population growth and unparalleled infrastructure development. Projects such as the Maroochydore City Centre, the airport expansion and ongoing road upgrades are driving employment and business activity.

But such rapid growth generates its own issues, notably a shortage of industrial space. The industrial sector dominates commercial property performance across the Sunshine State, with yields strong, demand unrelenting, and land values growing more rapidly than most metropolitan areas.

Image of Yandina property with Yandina town in background

land acquisition in gympie new banks pocket heights estate

New 199-lot estate planned near Gympie as house demand grows
New 199-lot estate planned near Gympie as house demand grows 2048 1228 j23HWa0ZBIED

More than 150 years after James Nash struck gold, the Queensland town of Gympie is experiencing a new boom, reflected in a buoyant economy, rapidly increasing population and higher, but still affordable, property prices.

With a population approaching 60,000, Gympie is attracting unprecedented migration, newcomers attracted by the town’s location – less than two hours from Brisbane and 40 minutes from Noosa – its big city amenities, laid-back lifestyle and comparative affordability.

One of their biggest problems is finding somewhere to live.

Against this backdrop, Sunshine Coast-group Rafter Myers, though their fund management business RM Capital has acquired a 19.8ha residential subdivision just five minutes from the Gympie business centre, on which it plans to quickly develop 199 home sites.

RM Capital settled on the property this week, paying $13.5 million – equivalent to $67,840 per lot of raw land value – in an off-market deal.

The property, situated on Banks Pocket Road, Butler Street and Old Maryborough Road, has excellent access to shops, schools, medical facilities, two golf courses, a swimming complex and community services.

It is close to the Bruce Highway, which links Gympie with Brisbane and the nearby Sunshine Coast to the south, and the state’s major coastal cities to the north. The property is zoned Residential Living and Rural Residential – ideal for lower density residential development.

A Development Approval is already in place for 184 of the proposed .lots, while Stage 1, comprising 29 lots, commenced construction the day after settlement. Local civil contractor Civilivic were awarded the stage 1 contract of new estate Banks Pocket Heights.

location image of new gympie residential estate Banks Pocket Heights

RM Capital established a property fund, inviting investors to share in a project that would help fuel Gympie’s growth. Shares in the fund were snapped up within hours.

“We’re excited about the potential of Gympie,” RM Capital director Josh Myers said. “The town is enjoying significant population and investment growth as newcomers discover its attractions.

“Large numbers of people are moving into the region, many discovering they can work from home, and enjoy the benefits of an affordable, quiet regional lifestyle without forsaking any of the attractions of big city living.”

“We are buoyed by having sold 80% of Stage 1 before construction commenced via off market relationships. This has validated the market acceptance for our product and will allow us to now fast track the commencement of stage 2.”

9 Nicklin Way Minyama off-market acquisition image of Directors Remi and Josh

Sunshine Coast tenants like the building so much they bought it
Sunshine Coast tenants like the building so much they bought it 2048 1228 j23HWa0ZBIED

One of the Sunshine Coast’s best known office blocks, a high-profile building in Minyama that more than 65,000 vehicles pass by each day, has been sold for $7.5 million. And the new ownership group includes two tenants who wouldn’t want to work in any other building.

The sale of 9 Nicklin Way, Minyama, was brokered by Brisbane commercial agent Sam Richards, of Jones Lang LaSalle (JLL), who contacted Sunshine Coast fund manager RM Capital in early December to present the opportunity.

“We were able to broker an off-market deal fairly quickly,” Mr Richards said. “It was the second time we’ve represented this particular private Brisbane-based investor group on a sale. And in this instance we could see RM Capital would be an ideal buyer.”

RM Capital Director Remi Rafter, who believes the building is one of the best office blocks in the region, said a deal was agreed within days and signed off on 12 December. Settlement is scheduled for 3 March.

A property fund – to acquire, improve and eventually sell the property – was established with a target offer amount of $4.2 million. Individuals associated with RM Capital, the investment arm of Rafter Myers, took up $1 million of the equity, while long-term tenants Grenfell Murray and Diamond Partners snapped up the remaining $3.2 million. The balance funds were provided by National Australia Bank.

Mr Richards said the asset has a mix of secure income in the short term, but with a 2.5-year WALE, there will be increased value when rents are reset in the next few years.

Brendon Murray, a partner of Grenfell Murray, who had worked for accounting giant Bentleys before acquiring the firm’s Sunshine Coast business, said it had always been his dream to own the premises in which his company worked.

“I think it’s the best office building on the Sunshine Coast. And the signage!” he said. “Do you realise how much it would cost to have a billboard that size?”

Mr Rafter said the target amount was reached very quickly. “All it took was a couple of phone calls. Everybody understood the potential of the asset.”

The 2,146sqm office complex, situated on one of the Sunshine Coast’s busiest arterial roads and within the centre of the Minyama/Kawana Waters CBD, includes 40 car parks and 1,234sqm of commercial space across two levels.

Tenants include real estate agency Coronis, accountants Grenfell Murray, financial planners Diamond Partners, and Martens Wealth Management, legal firm Hawkes Lawyers, and building services and compliance consultancy Building Approvals.

9 Nicklin Way Minyama off-market acquisition image of building

Mr Rafter said it would cost more than $11 million to rebuild the asset. “In fact you can’t build new office blocks in the current market,” he said. “It’s just too expensive.”

“Sunshine Coast office vacancy is presently 4.3%,” he said. “That’s the lowest on mainland Australia.”

He said the tenants of 9 Nicklin Way were presently paying an average net rent of $410 per square metre, a figure which he indicated was substantially below its true value.

As well as enjoying an extraordinary profile, Mr Rafter said a feature of the building was its exceptional floorplates, which provided an open, inviting atmosphere for employees and clients.

“And the signage is just incredible,” he said.

The strategy for the fund which now owns the property is to provide an estimated 82 percent return over a five-year investment period – made up of quarterly cash distributions and capital uplift should the building be sold after five years.

Mr Rafter said with two of the tenants potentially holding most of the equity, it is possible – even likely – the building will not be offered for sale at the end of the investment period.

Property acquisition Syrenuse Mooloolaba Sunshine Coast

Iconic Mooloolaba retail precinct hammered out in the surf
Iconic Mooloolaba retail precinct hammered out in the surf 2048 1228 j23HWa0ZBIED

A deal to purchase one of Mooloolaba’s best known retail precincts, hatched by two of the region’s most prominent property figures while bobbing on skis in the early morning surf, will be complete when a Sunshine Coast fund manager pays $7.6 million for the retail component of Syrenuse Mooloolaba this week.

Director Remi Rafter, who believes the property, situated on the corner of Brisbane Road and Mooloolaba Esplanade, is the best corner retail precinct in Mooloolaba, is at Mooloolaba Surf Club with realtor Bob Stewart most mornings well before the sun is even up.

Mr Stewart has managed the property for 15 years on behalf of Brisbane investor Joan Crowley, who has owned Syrenuse since it was first built in 1982.

Last August Mr Stewart told his surf club mate that Mrs Crowley was finally interested in selling the iconic corner block, initiating an off-market negotiation that concluded with a contract being signed at the end of November.

“It was an opportune time for her to sell” Mr Stewart said.

Syrenuse is a landmark eight-storey mixed-use beachfront building, its enduring design by Noel Robinson Architecture having been recognised through multiple industry awards. It is the 664sqm of commercial lettable space – comprising a diverse mix of seven tenancies – which RM Capital has acquired, the investment arm of Rafter Myers.

Tenants include Leading Realty Sunshine Coast, Cici’s Continental Deli, Hair At Mooloolaba, Enrich Thai Massage, Zambezee fashion boutique, Pink Pantha convenience store and long-established Mexican restaurant Montezuma’s, which is in the process of relocating.

Montezuma’s departure provides RM Capital with an opportunity to modernise and enhance the property with the goal of it becoming a retail showplace. Architectural plans are already being drawn up.

Mr Rafter said the precinct would become a quality asset, comparable with Fortitude Valley’s James St and the Howard Smith Wharf complex. “That’s the standard we’re looking at,” he said.

Property acquisition Syrenuse Mooloolaba Sunshine Coast

He said it would be the best retail corner in Mooloolaba, pointing out that most visitors now parked in the multi-storey car park in Brisbane Road, before accessing the beach or the Esplanade shops.

“Everyone who visits Mooloolaba will walk right past our property and our shops. This is where you want to be,” he said. “It’s why people call this intersection ‘Central Station’.”

RM Capital, a Sunshine Coast-based fund manager with a track record of completing value-driven property investments, established a fund and sought $5 million of investment to fund the purchase, pay fees and costs, and put aside $2 million for renovations. The balance of funding was provided by National Australia Bank.

The fund was fully subscribed within hours, exclusively by local investors.

Mr Rafter said the plan was to actively manage and improve the property’s performance and appearance, attract high quality national tenancies, then sell the asset, perhaps in five years’ time noting the flexibility offered through the eight separate property titles.

He said investors were expected to benefit from a forecast 89 percent return, made up of six percent quarterly cash distributions, as well as a share of the returns when the property is sold providing the fund members with wide flexibility during the selling period.

Property acquisition Syrenuse Mooloolaba Sunshine Coast

image of josh and remi in front of Birtinya property acquisition

RM Capital settles on office buildings in Maroochydore and Birtinya
RM Capital settles on office buildings in Maroochydore and Birtinya 2048 1228 j23HWa0ZBIED

A Sunshine Coast investment management company will today finalise the purchase of two commercial properties with the potential to increase investors’ holdings by as much as 80 percent within the next few years.

RM Capital, the investmetn arm of Rafter Myers, owned by Remi Rafter and Josh Myers, will settle on properties located at Birtinya and Maroochydore, the region’s two commercial hot spots.

Negotiations for the two office blocks – one at 20 Innovation Parkway, Birtinya; the other in Plaza Parade, within the Maroochydore city centre – were secured months ago off market.

RM Capital then offered investors an opportunity to secure a share of the properties. Applications filled quickly and the offers were rapidly oversubscribed.

20 Innovation Parkway, a high-profile three-level commercial building situated within the Sunshine Coast’s health precinct, was purchased for $12 million, about 32 percent below replacement cost. The fully tenanted building provides 2,678sqm of lettable space and 108 sealed car parking spaces.

Image of Birtinya property in Innovation Parkway

RM Capital’s strategy is to achieve sustained rental growth – current passing income is about $975,000 – undertake minor building improvements, and consider potential further development. The company expects investors to achieve an 80 percent return over five years, at which time the property will likely be sold.

The Maroochydore property comprises a 100% interest in 5 Plaza Parade and a 75% interest in 7 Plaza Parade, a two-level commercial office building which forms part of the Plaza Links development.

Image of Maroochydore property along Plaza Parade

Over the next few years, RM Capital intends undertake considerable building improvements, and hold the 2,978sqm land rich island site with a 60 metre height limit under the proposed new town plan.

RM Capital secured the property in August for a combined In One Line purchase price of $7,775,000.

At the time, the building contained four vacant tenancies, with another due to expire in January. But through aggressive marketing during the due diligence period, RM Capital has secured four new lease agreements, with the occupancy rate increasing from 60 percent to 91 percent.

RM Capital principal Remi Rafter said with office vacancy rates below four percent on the Sunshine Coast, the company was expecting to achieve sustained rental growth in both properties over the medium term.

“Land availability, challenges with planning approvals and construction cost pressures will limit further office supply in the foreseeable future,” he said.

image of oceanside carpark with sunshine coast university hospital in background

Investors quick to grab a share of Birtinya car park
Investors quick to grab a share of Birtinya car park 2048 1228 j23HWa0ZBIED

Directors of a Sunshine Coast funds management company are delighted at the response to their offer to invest in a multi-storey car park situated in the heart of Birtinya’s booming medical precinct.

RM Capital, the investment management arm of Rafter Myers, invited investors to become part-owners of Oceanside Car Park, an eight-level car park and retail asset opposite the Sunshine Coast University Hospital.

RM Capital sought to raise $11.2 million, and were thrilled when 21 investors pledged the amount faster than anticipated.

The asset, which comprises 581 parking spaces and five ground floor retail tenancies, had been purchased for $20,962,500, a sum which is only 31 percent of its estimated replacement value.

image of oceanside carpark acquired by rm capital investment arm of rafter myers

image of oceanside carpark acquired by rm capital investment arm of rafter myers

“As active managers, with significant project delivery and construction experience we are very good at identifying and executing improvements that will drive returns for our investors,” said Remi Rafter, a director of RM Capital, which currently manages 26 projects throughout Queensland.

So enthusiastic was the take up that RM Capital had to scale back the offer, but Mr Rafter said all 21 investors would share in the ownership of the car park, which had been purchased off-market through direct negotiations with the vendor.

“We have targeted this asset for some time,” said Mr Rafter, who operates RM Capital in partnership with his one-time Australian Army colleague Josh Myers.

“The car park is located directly across the road from the Sunshine Coast University Hospital, one of Queensland’s leading hospitals, in one of the fastest growing regions of Australia,” he said.

The car park is currently operated under a management agreement with Secure Parking, while there is 768sqm of retail space on the ground floor.

The catchment area for the car park is only 43% developed, with four nearby vacant commercial sites that will considerably increase car park demand in the future when developed.

There are restrictions on the amount of parking that can be provided at those sites, with no town planning options for additional commercial car parks.

Mr Rafter was confident investors would be well rewarded for their support of the offer.

“We consider this investment will deliver superior risk adjusted returns over the medium term through our active management strategy,” he said.

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