1. Multipliers in management rights
Multipliersin managementrights isoneof thekeyareasthatpeople arekeen to findout
more about. We have seen all areas of the Sunshine Coast achieving good multipliers
especially businesses with net incomes in the higher bracket (mid $300,000 to
$800,000+).
So whatarethefactorsthatinfluencethemultiplier whenbuyinga managementrights?
 Body corporate salary, subject to annual increases usually CPI.
 The module type of the caretaking and letting agreement,
 Accommodation versus standard 10-25 years - with management rights it
can only be terminated under a legislated process and this rarely happens.
This certainty offersstrength to the model and security in your investment,
unlike generalindustryjobs you can be terminated with shortnotice (oneto
four weeks).
 Return on investment can be very rewarding personally and lucrative
financially through capital gain.
 Management rights returns on investment are attractive in comparison to
currentbankinterestratesofferedbylenders,or in thecurrentvolatile share
markets.
 Managementrightshasno debtorsdueto thetenants whetherthey arelong
or short-term (holiday makers) pay up front and this is held in a trust
account.
 Manager’s commissions and expenses are paid monthly once the unit
ownershave been paid and, in addition,managersarepaid their monthlyBC
salary.
 Trust accounts are a legal requirement and are audited as necessary by
regulatory requirements. This in turn offers certainty to the industry.
 Having minimal stock and basically zero stock write-off compared to other
industry businesses.
 Staffing - many management rights businesses are capable of being staffed
by a two-person team, generally being the purchasing couple with
contracted cleaners or other service people to assist.
 Workhoursin managementrightsprovidesflexibility. Time can betaken off
at your discretion, within reason. The business can be managed by you, and
only you. Yes, thereare stakeholdersand like any business relationshipsand
trust are an integral part to the success of the business.
 Sunshine Coast provides management rights owners in permanent or
holidaywith certaintyas peoplewill alwaysneed somewhereto live. Holiday

2. makers will always need to have a holiday, the current environment with
Australian dollar, terrorism and our green natural status is an attraction to
international and national visitors.
 Regular income, although the holiday market can go up and down across a
12-month period, occupancy rates are reasonably consistent across the
board and this has been the case over a number of years.
 You mayberestricted to a buildingbutnota territory.SomeMR ownersown
more than one operation. Also there can be options to earn additional
income by completing sales in your complex.
 You are buying real estate or a manager’sresidence also. Bricks and mortar
that you own. You live where you work so travel costs are reduced also.
So the multiplier is simply the accountantverified net income multiplied by a factor of
anywhere between two and six.
The morecertainty or legislated a business, perhapssafer for wantof a better word is,
then the morevalue itmay hold.A recenttrend hasseen buyerspaya highermultiplier
if a complex fits their own criteria and personal circumstances (location, manager’s
unit, body corporate salary, net income, growth opportunities, the caretaking and
letting module, ability to live off site, no set office hours).
Got to be good for you!
Regards
Wayne Stoll
0452181 505 Wayne.
0419506760 Linda.
wayne@thinkmanagementrights.com.au
www.thinkmanagementrights.com.au