For those wondering what the market might pay for their SDA property once they have built and have a history of rental income
ARENA Real Estate Investment Trust bought SDA properties on 6% Yield in Adelaide. This is an outstanding result for our sector when an ASX 300 listed trust is prepared to buy SDA property on that yield.
Below is a table based on the rental income (net of management and care fees) from our Freedom 4 properties and the purchase price if a buyer was willing to pay based on the yield in the left hand column.
Obviously one listed trusts’ purchase does not establish a market of it’s own, however, given the yields on other commercial property, the yield they paid achieves a better return for their investors than most other properties. But even on 12% yield, the profit for the original investor is substantial.
This is for information on what someone has paid and what a property sale would look like if some one else was willing to pay, not an estimate of value.