Affordable lodging to replace Grafton hotel

The planned new accommodation and retail complex at 121 Grafton Rd has an immediate pool of visitor demand from neighbouring hospitals. Photo / Supplied

A state-of-the-art accommodation complex is planned for the Grafton Oaks Hotel site on the corner of Grafton Rd and Park Rd, opposite Auckland Hospital.

Development plans for the five-storey building plus basement carpark envisage a new building with 300 units, along with a street-level cafe, kitchen-dining area, library, laundry, two reception lounges, courtyards and bike storage.

The aged Grafton Oaks discount hotel, which occupies the 3000sq m site at 121 Grafton Rd, will be demolished to clear the way for construction of a new building, expected to be completed next year.

The new 7012sq m development with 64 carparks is expected to be of interest to hoteliers or other specific user groups, and is being marketed for sale or lease via expressions of interest closing July 20 by Cam Paterson and Wayne Muir of Barfoot & Thompson Commercial.

Each accommodation floor of about 1400sq m will house up to 85 units, varying in size from 12sq m to 27sq m depending on the amenities selected for the various levels.

"This property is in a key location with an immediate pool of visitor demand created by the neighbouring Auckland Hospital, Starship Children's Hospital and medical school," Paterson says.

"It is also within the city's university and education precinct, and relatively close to the CBD and Newmarket. It benefits by being near Auckland Domain, the War Memorial Museum and only a short drive to Vector Arena and Auckland's waterfront area. Regular public transport services are at the door while major motorway junctions are within 500m of the site."

Paterson says the planned complex has been designed to provide "cost-effective" accommodation. "Recent global trend are towards units that offer tenants full hotel amenities but that are easy on the wallet. This development will fit the bill and will be a first on such a large scale for Auckland."

Designed by Hallion Architects, the concept calls for the installation of high-standard telecommunication services and the use of new technologies in building techniques.

Muir says the cost-effective design is flexible and could be changed easily to suit special sector groups.

"The development is planned on a turn-key basis right down to furniture, pots and pans, so that on completion leasing of the rooms can commence. The lessee or purchaser does not have to provide all the fit-out in order to start business because this will be provided by the developer."

He says the project is not reliant on an individual selldown of the accommodation units. "This is one large, purpose-built, non-permanent accommodation complex."

Muir says Auckland's population is projected to reach 2.5 million by 2025 and affordable short-term accommodation near the central city has been recognised as an issue.

"This location will cater for people who don't wish to pay for five-star accommodation but who still require good facilities. The development is a vote of confidence in Auckland's future and we are already fielding inquiry from outside New Zealand, confirming our view the facility is in the right location at the right time." Muir says the site has been the focus for a number of development schemes in the past but, in most cases, they were based on separate-title apartment-style units designed for individual sale.

"These projects would have made it difficult to cater for non-permanent accommodation, so this project has been kept simple as one complex with no unit titles.

"In recent years there have been few new accommodation developments predominantly due to low confidence caused by the failure of finance companies and cautious lending by the banks.

"The reduction of new stock supply, coupled with an increasing demand resulting from the Christchurch earthquake and immigration, has resulted in greater demand for inner-city rental property."

Muir says plans and specifications will be made available to potential purchasers and tenants who can submit offers based on their design specifications, along with operating financial models of a proposed business operation.

"Obviously a development of this scale will require operators with an established history and experience in the hospitality industry," he says.