Investors paid 50.96p per share in the New Listing for this property, and it became available on the Resale market August 19th 2015.
A rare opportunity in central London, Zone 1 - this is our third flat from Tower Mint Apartments.
We believe that Tower Hill and this property have a compelling investment case underpinned by two factors:
- The property is exceptionally well located, just 300m from Tower Bridge and 700m from the iconic ‘Gherkin’ building of London’s financial district. Stations that are within 850m of the property connect the area to the London Underground, Docklands Light Railway and train networks.
- The gross rental yield and dividend yield for the property are unusually high for prime central London. This is partly due to the purchase price secured, and partly because we have secured a contract with a ‘serviced apartment’ operator which eliminates voids and reduces costs.
Read more detail on the investment case here.
Property Partner does not provide advice and nothing in this Overview should be construed as investment or tax advice. The information which appears in this Overview is for general information purposes only and does not constitute specific advice.
The flat was acquired vacant and in good condition and the Chartered Surveyor’s report identifies no material issues. We have made a provision of £1,200 for tests that are required, for any remedial works that the testing reveals, and for minor, sundry items listed in the surveyor’s report. There is also a provision of £1,200 for furnishings.
The property was income-generating from August 19th, based on a contract we have secured with a 'serviced apartment' operator. They have contracted to pay the rent on the entire building for 27 months, and we expect to be able to renew this contract, or a similar form, immediately thereafter. This arrangement eliminates ‘void periods’ and also management burden, allowing us to reduce our fee on rental income down to 6% (+VAT).
After accounting for building service charges payable to the Freeholder for block management, maintenance and insurance of the building, this equates to a Gross Rental Yield of 3.96% and a forecast Dividend Yield of 2.72% (fully accounting for purchase costs, furnishings, remedial cosmetic works, forecast maintenance, annual voids, corporate taxation and all fees). From April 2016 UK taxpayers are entitled to a £5,000 annual dividend allowance. See our FAQs here for more information.
For prudence, we haven’t included any growth in rental values in our forecasts - any growth in rent (on contract renewal) would be incremental to our forecasts.
This transaction was approved by our RICS qualified Director of Property.
A two-bedroom, first-floor flat with an open plan living room and kitchen, and separate family bathroom. The master bedroom also has an en-suite shower room.
The flat has the benefit of a communal garden.
- Share Valuation
- House Price Index
- Rental Income Breakdown
- Latest Valuation
- Latest Share Valuation
- Latest Property Value
- Amortised Purchase Costs
- Deferred Tax
- - £9,737
- Latest Valuation
Note: The estimates provided do not constitute valuation advice; it remains your responsibility to determine valuation.
The HPI is an official statistic that captures changes in the value of residential properties across England and Wales. It is published by the Land Registry, which is a UK government organisation.
Note: Past performance is not a reliable indicator of future results.
Residential property investment is a total returns product. This information is the income component only. Increasing capital values have historically driven most of the return.
- Gross Rent per year (E)
- Service Charges
- - £1,100
- Gross Rental Revenue
- = £22,560
- Gross Rental Yield
- - £6,625
- Letting and Management
- Property Insurance
- Maintenance Allowance
- Corporation Tax
- Dividends per year
- = £15,935
- Dividend Yield
Note: UK taxpayers are currently entitled to a £5,000 annual dividend allowance. This means that the total income related tax you pay is no greater than if you were to own the property directly. Gross rent and dividends may be lower than estimated. Tax treatment depends on individual circumstances and may be subject to change in future. See FAQs for more information on taxation. The Dividend Yield assumes an investment at the Latest Valuation.
Flat 3, Tower Mint Apartments, Tower Hill, London, E1 8JX,