The vendor, a large quoted company, had completed a well-publicised growth phase through acquisition, and as such established a requirement to dispose of liabilities from its accounts. In January 2007 we paid £1.75m for the site valued at £1.925m. With debt of £1.54m, payable at a rate of 5.5%, debt servicing was £85,000pa versus annual income of £132,000, producing a £47,000 annual positive cashflow. Including transaction costs, the Falmouth purchase equalled £1.835m. With equity of £295,000 (17% of the purchase price) invested, there was an annual 16% return on investment capital from rent alone.

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Besides this, the low base rents and low capital value in the new building gave us confidence in the opportunity to realise rental and capital growth.