Ups
Property options in East London (4.2x cash-on-cash return)
In 2004, we acquired an option over a messy car storage lot in East London. Our initial application for a residential block of apartments was declined. We appealed and lost. In Jan 2006, we succeeded with our second planning application. We then sold the option in 2006 and generated a return of 4.2 times our investment. Separately, in 2007 we helped a property owner in East London to resolve some complicated financial issues. In return, they agreed to grant us an option to purchase their property for a fixed price. We then sold the option to a large UK housebuilder for an upfront payment of £500k. The return on our capital was infinite. The return was on our effort and ideas.
Off plan properties in East London (26x cash-on-cash return)
We queued-up overnight in sleeping bags to buy apartments off-plan in East London. We paid refundable booking deposits of £1,000 each for the most attractively-priced units on a per square foot basis. A few months later, we exchanged contracts on the properties and sold the contracts. We generated returns of circa 26 times our booking deposits in less than a year.
Online retailing, Ireland (6x cash-on-cash return in 6 years)
In 2012, we acquired a substantial online retailing business in Ireland. Despite getting off to a horrible start (2012 to 2014 was absolutely horrendous), we managed to turn it around and grow it by 127% compared with 2012. Current valuations suggest that we have generated a return of over 6 times our initial capital over a period of 6 years.
Bespoke internet logistics, Ireland (35x multiple in 5 years)
In 2013, we started a bespoke internet logistics business in Ireland. We provide stock storage, pick and pack, order processing, kitting and delivery services to a range of online retailers and product manufacturers. So far, based on the most recent funding round, we have generated a return of circa 35 times our original investment over the last 10 years. However, this return does not factor in the cost of all the blood, sweat and tears along the way.
Distressed investment property, Dublin (22x multiple in 10 years)
In 2014 we purchased a vacant investment property in Dublin from a distressed bank that was exiting the Irish market. The property is currently worth 22x what we paid for it.
Traditional retailing turnaround, Dublin (41x cash-on-cash return in 7 years)
In 2010 we acquired a convenience retailing business in Dublin that was suffering severely from the downturn. We turned it around and back to profitability within 12 months. In 2016 we converted the property into a food retailing business. In 2017, we sold the business. Including profits over the years and the sale price, we generated 41 times our original equity investment.
Adding additional floors to apartment blocks in London (5-11 cash-on-cash returns)
In the 2000s, one of our favourite pastimes was acquiring freehold ground rents in London. We usually acquired them for less than £30k each. The rent generated from them was relatively low. But they were very safe and secure. The best thing about them is that they usually had the rights to light and air above the apartment blocks. We obtained planning consents to construct additional floors of apartments. Then we sold the properties, with the benefit of the planning consents. When we did this, we generated returns of 5-11 times our (ungeared) investment.
Traditional retailing turnaround, Dublin (no consideration paid for business)
In 2015, we acquired a traditional retailing business in Dublin. The business was losing so much money that the owner did not require any consideration (other than for stock). As a result of employment law complications, the turnaround took 24 months, which was about twice as long as we were anticipating. We still own the business which is trading well and future prospects are very promising. The return on our financial capital is infinite. The real return is on our sweat and effort.