But after implementing the tools acquired through I Love Real Estate training and the Platinum Program, he quickly up-skilled and with one deal, he was able to get back on track and build a passive income stream of $104,000 a year, plus an equity gain of over $2,000,000. This is how he pulled it off.
After a messy partnership breakdown, the value of Peter’s business disintegrated and he was left without a leg to stand on.
Thankfully, Peter had been a member of the I Love Real Estate (ILRE) community for a number of years and with the mentoring he had received through the Platinum Program, he was positioned to take action.
The first step was to let go of the office he no longer needed and sell his principal place of residence. He and his wife, Kerrie, loved their house but could see that it didn’t fit with their financial goals.
“We didn’t want to sell the house but Dymphna said to us: ‘You can either get over it and get on with it, or you could go under’.”
Having completed a number of successful property deals in the past, Peter felt he was ready to look at a high-yield commercial property.
He found what he was looking for in the coastal town of Nowra NSW, which was experiencing rapid growth. The five-lot vacant block was on the market for $950,000, but Peter picked it up for $715,000 in a distressed sale – and that was after the seller put in an 18-metre wide road!
After finishing the subdivision process – including street light and developer contributions – Peter sold one lot for $250,000. he used this money to fund a good chunk of the remaining deal.
He then found a great buyer – a government agency – that was willing to pay $765,000 for three of the lots.
He was left with one block. His wife Kerrie noticed that there were a lot of children in the area, so they thought about building a child care centre. Peter found someone who managed a number of childcare centres in the area and signed a 15-year lease on a 96-place hi-tech childcare centre, at $190,000 a year.
With a long lease in place, finance was easy to obtain. Construction cost just $1.1M, with the fit-out and out-goings paid for by the tenant. What’s more, the lease is contracted to increase by 3.5 per cent, which feeds directly into the capital value of the property.
With a lease of $190,000 a year, and mortgage costs coming to $76,000 a year, the deal puts $114,000 a year into Peter’s pocket. With just one deal, Peter had broken free from his financial burden.
However, Peter cautions that this strategy might not work for everyone. Despite having a fantastic team behind him, he said there’s a lot to get your head around.
Peter’s story goes to show that with the right training and strategy, you can get yourself out of even the deepest of holes.
“Kerrie and I have always had a great marriage and work as a strong team. She is the wind beneath my wings.”
These stories and the results in them were captured at a specific point in time. The real estate market and the investing strategies used to succeed are constantly changing. The achievements and results of these investors may have changed since these stories were recorded. Each of these investors engaged in in-depth training, coaching and mentoring to be able to achieve these results. Their results are not typical and should not be taken as a guarantee of the results you may achieve. Your personal results will be in line with the training, education and hard work that you personally conduct.
With the right training and strategy, you can get yourself out of even the deepest of holes.
Cashflow: $114,000 pa
Equity: $1,700,000 –
Cashflow: $114,000 pa