Bancroft Road Investment Strategy
The following statement was made to potential investors in the Information Memorandum dated 12 September 2013
The Trustee believes that over the long term well located industrial land will appreciate in value at annual growth rates in excess of the Australian consumer price index. The Trustee also believes that properties with low site coverage are best placed to benefit from this growth in value and will therefore significantly outperform other industrial investments.
This Property has very low site coverage (16.5%), and consequently a significant portion of the value of the Property is best ascribed to the value of its land. The Trustee believes this investment is therefore an opportunity to derive a high yielding annual cash flow whilst sitting on a very well located parcel of industrial land with excellent growth potential.
International trade is a significant contributor to the GDP of Queensland. The Trade Coast precinct is the only industrial area in immediate proximity to the Port of Brisbane and Brisbane Airport. The progressive closure of Hamilton Port and the concentration of all of Brisbane’s port related activities to the Port of Brisbane will further enhance the attractiveness of industrial land in the area.
The largest risk with every industrial property is vacancy. The Trustee believes that the Property suits the current tenant who appears to be well regarded and successful participant in its field of operation. In any event the Trustee believes that in the current market conditions, if this property became vacant, it could be released within 3-6 months. The consequences of this risk are mitigated by a bank guarantee equal to 6 months of rent and outgoings.
Source: Information Memorandum dated 12 September 2013