This article is from the Australian Property Journal archive
ASPEN Group has acquired a partially refurbished co-living community at Cooks Hill, Newcastle, for $3.75 million under a liquidator’s sale.
Located at 82 Parkway Ave Cooks Hill, the residential building is currently operated as a co-living community with 55 rooms that are suitable for single occupants. It is undergoing a refurbishment and only about 60% occupied.
Joint CEOs John Carter and David Dixon said Aspen will complete the refurbishment of the community areas, and combine some units and add en-suites, to enhance the accommodation offer and tenant mix.
“There is also the potential to add more “affordable rental housing” floorspace to the site under current planning guidelines and develop the entire site for higher and better use in future,”
Total all-in cost after refurbishment is expected to be approximately $4.75 million, equating to $116k per unit (under a 41-unit scheme) and $3,167 per sqm of dwelling area. Net rental yield on cost is expected to be about 4.5-5.0% upon completion at gross rents of $175-200 per week, which is about half the rent of one bedroom units in Cooks Hill.
“Newcastle is NSW’s second largest metropolitan area and it has a very diverse economy. Cooks Hill is one of Newcastle’s premium suburbs located between the CBD and coastline.
“This acquisition follows the Burleigh Heads acquisition and reinstatement of earnings and distribution guidance announced on 18 May 2020. We expect to be able to continue to grow Aspen’s business and portfolio profitability in future and we believe the opportunities will increase during this economic downturn,” they said.
