Unusual Investment.. ATM For Sale

ATM For Sale

This seems like an unusual 'property' to me. Yeah, great it's leased to Westpac Bank but what happens if they don't renew the lease? You can't use it as anything else.

It begs many other questions, such as:
And what do you actually own? A section of the wall?
And why wouldn't Westpac buy it?
And why would the current vendor be selling if it's leased to Westpac and it's so secure?

Your thoughts?
 
And why wouldn't Westpac buy it?

Why don't banks own all of their branches?

And why would the current vendor be selling if it's leased to Westpac and it's so secure?

That question can be asked of any tenanted investment, yes? If you applied the same logic to every tenanted investment, everything for sale would be suspect. It could be anything. The vendor needs money, they have a better investment opportunity, etc.
 
A mate has bought an old bank (3rd owner since bank sold) which still has the ATM located in one corner of the site.

He has continued to rent the ATM to the original bank for the last 7 years but is now negotiating with them hard as he has had an alternate offer from of the generic ATM vendors.

Mind you, looking at the attached article maybe he should just stick the the branded ATM.

Cheers
 
Pretty unique investment although I reckon that due to the type of security I think a yield of more than 7.5% is in order notwithstanding that WBC is the tenant. Specialised securities (which this is) sell for a much higher yield.
 
We've got 3 ATM's at the shopping centre.

They're a box in the wall, no big deal.

Banks pay decent rent, no trouble at all.

Wish we had more.
 
Nah no way this would be a cash purchase.
You're ambiguous Aaron. "No way. This would be a cash purchase" or "No way this would be a cash purchase"?

It seems to me to be a higher risk investment for not a great return. 7.4% current return- but as has been pointed out, people are using ATMs less- which is probably why the bank would be selling. It would limit the resale value as well.

There was something in the press in the last few days backing up this article. Now that ATMs have to display the cost of the transaction to the consumer, people are becoming much less inclined to use an ATM. This was a resuk\lt which surprised the researchers- they had expected the usage to remain much the same. Sorry, I can't find the article.
 
There was something in the press in the last few days backing up this article. Now that ATMs have to display the cost of the transaction to the consumer, people are becoming much less inclined to use an ATM. This was a resuk\lt which surprised the researchers- they had expected the usage to remain much the same. Sorry, I can't find the article.

It was probably a report on a recently released RBA discussion paper.
ATM Fees, Pricing and Consumer Behaviour: An Analysis of ATM Network Reform in Australia"]ATM Fees, Pricing and Consumer Behaviour: An Analysis of ATM Network Reform in Australia
http://www.rba.gov.au/publications/rdp/2012/pdf/rdp2012-03.pdf
"This transaction will invoke a foreign ATM transaction fee of $2.00, do you want to cancel yes/no"
 
Pretty sure it's no fees if your with that bank or if its an affiliated ATM.. Depends how many Westpac customers are in the area? Anyone know how much these usually go for? Never seen one for sale until now...
 
But it's more like a lease of the ATM rather than you owning it, the ATM is only woth 10% of original cost at the end of 8-10 years. Therefore, it isn't really a 20% return.

Thats not really clear from the website. It says own your own atm, and then states you are the landlord to an 8 to 10 year lease to the operator.

There may well be no resale value at the end, due to people swiping their barcoded arms at the supermarket by then, even so, the returns are as good as those touted for property (10%pa)
 
You need to take into account the time value of money as well. While average return may be 10%, you're putting up the big capital right at the start and are getting 20% of that back each year.
 
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