After having a good break over Christmas and picking ourselves back up after the first location fell through, we started the search again to see what other options we had.
You wouldn't guess it, but there was next to nothing around in the areas we'd been looking that was the size we needed, or in a location that would be workable for us.
We had always intended to buy a factory and had gone through the process of setting up a self-managed super fund, had bank pre-approval for the loan, and everything was ready to go.
We had a look to see what was on offer in the rental market. If we could get somewhere now, we could always look to buy from the owner down the track if they were willing to sell.
The rental market had more on offer, so we started the process of looking.
Another Potential Home… With a Twist
I managed to find a good location. Well, at least I thought it was…
The location was advertised at the size we needed, it was in a good spot and was a bit of a weird shape for a building, but it was very workable.
I looked at it once and thought it looked fine, but it seemed smaller than what was advertised, which was probably why the cost was lower. I asked the agent if there were any plans available.
Eventually, I ended up going and measuring it myself.
Yep, I was right. It was almost 100m² smaller than what they had advertised.
I did some calculations, drafted up some floor plans and worked out that, with the addition of a mezzanine, we could make it work.
The upside with this location was that it had a lot of power already run to various locations, including three-phase power, which we would utilise.
We started negotiations, which halted very quickly.
Turns out the current tenant still had 12 months left on their lease, and the owner wasn't willing to negotiate at all unless the current tenant paid the difference.
Then, during the process and a conference call with the agents, they let something slip about why there was so much three-phase power around the factory.
It turns out that while the factory was empty when I inspected it, it had previously been fitted out with large refrigerators used for storage - storage of what? nothing alive is what we were told..
While negotiations were stalled and likely not going anywhere anyway, we used the time to bow out quietly…
Surely This One Will Work?
Less than 100m away from the above location, we found another two options. Both were the same size and owned by the same owner.
Again, a little on the small side, but with a mezzanine, they would work for what we wanted to do.
We picked the factory that was empty and clear of internal fit-out and sent through an offer to start negotiations.
The response on this one was taking time. It turned out the owner was overseas, which was delaying things.
They came back to us with a lot of questions and queries first up, wanting to know what food we were serving (if any) and how our fit-out would look.
I drafted up a fit-out drawing as best I could to give them a better idea.
Following that, they came back wanting an official architect-drafted fit-out drawing and a copy of our business plan…
WTF?
I wasn't engaging an architect to do a fit-out drawing for a location we didn't have a lease on, and why would I provide them with a copy of our business plan?
We're leasing off them, not going into business with them…
And Then COVID Arrived…
Just as this was happening, it was all over the news. COVID had hit Australia, Scotty from Marketing had announced shutdowns for the hospitality industry, and things were getting worse by the day.
Kylie and I talked about it and decided we had to put things on hold.
Who knows how long all this is going to go on for?
I responded to the agent with a, "Thanks, but we're going to put everything on hold and wait for COVID to pass before committing to anything. We will be in touch."
Maybe there's a reason we haven't locked in a location yet?
To be continued…