The Forza Cheltenham Opportunity Fund held a brand new existing office building of 4,922 m2 and 357 car parks on a land allotment of 14,605 m2 (1.46ha). The property was leased to iSelect Ltd on a 10 year lease which commenced 1 July 2011. The appeal of the investment was in creating value at day one by matching up a new but vacant building together with a significant lease covenant.
As part of the transaction with iSelect, a major fit out of the building was undertaken which has won a number of awards. The investment provided a strong cash flow to investors whilst also providing a significant capital uplift when the asset was sold in December 2013 for $24,000,000.
Over the investment period of 2.85 years investors obtained an 83% return on their original equity (IRR of over 26%). The investment was also largely tax advantaged which helped further augment the after tax returns to investors.