Shopping centre, tavern for sale

A new Finstar Management development in Pukekohe township containing nine shops, a tavern and the site of two proposed retail units has been put on the market.

The 7029-square-metre freehold property at 65-71 Edinburgh St already has long-term lease agreements with tenants in place generating $644,950 a year.

It's estimated the two new units will generate a further $137,500 a year for a total income of $726,200.

Adam Sigley, of Barfoot & Thompson Commercial, who is handling the sale for Finstar, says the development will be of interest to investors as the nine recently built shops, which occupy an area of 1829sq m, each have new long-term leases ranging from six to eight years to national tenants like Columbus Coffee, Hell Pizza, United Video, Foodstuffs and the TAB.

Sigley says agreements are being finalised for the construction of two more retail units, with leases already being negotiated by a butcher and a greengrocer.

The retail property is in the business zone under Franklin District Council's operative district plan on the corner of Edinburgh St and Stadium Drive, within the central business district of Pukekohe.

"The high-profile corner position, and the provision of more than 100 car parks coupled with the long-term quality lease covenants, makes this a prime development," Sigley says.

"It is within walking distance from all central amenities and King St where the majority of the Pukekohe retail shops are located. It's also easily accessible from all surrounding residential areas."

The Pukekohe retail centre is for sale by deadline private treaty through Barfoot & Thompson Commercial, closing at 4pm on Wednesday, August 16.

Sigley says there has been little new development in the Pukekohe township over recent years, mainly because of a limited supply of suitable commercially zoned land.

"Recent redevelopment has mostly concentrated on Manukau Rd or the surrounding area, with an emphasis on bulk retail such as the new Warehouse development."

The double-storey 150sq m tavern is a separate building constructed in the early 1970s.

It contains a restaurant and pub with paved and covered entertainment areas, and a kitchen.

"The Doc Begg's Tavern was formerly a doctor's premises and hence its name," says Craig Rathbone, director of Finstar Management.

"The new retail redevelopment is on the original site of a 3 Guys supermarket that was closed over four years ago and has remained vacant since."

Rathbone says the majority of Finstar's developments are retail- based, including several "convenience retail centres". He said the Pukekohe site appealed because it had good exposure to the main traffic flows on one of the main entrances into Pukekohe and it was close to the main street.

"The site has great parking, which is an important factor in this type of development and especially because Pukekohe's main street has limited parking."

Rathbone says the majority of retailers within the Finstar development are new businesses to Pukekohe.

"We have tried to achieve a mix of tenants who trade seven days a week and most trade long hours. The site sits in between a 24-hour BP service station, a McDonalds and KFC outlets.

"Along with our development, this part of town will be the main area for shops and service providers who trade into the later hours in Pukekohe," he says.

Rathbone says the existing floor slab and some of the original steel frames from the old supermarket were retained.

The rest of the building is new, including shop frontages, roofing, internal fitouts, canopy and parapet. "Effectively it is a new building."

The shops feature aluminium frontages protected by a verandah and are built with steel framing and long-run metal roofing.

The internal construction comprises plasterboard partitioning, suspended ceilings, ducted air-conditioning and fitouts to specific tenant requirements. A corridor is designed to provide all nine retail shops with access to rear cartdock facilities.

Finstar was formed by Craig Rathbone and Cameron Loader in early 2002 and since that time they have completed and sold over $70 million-worth of development. Seven of these have been convenience-based retail sites with similar tenant mixes to the Pukekohe development.

"In addition to this we have completed several office and industrial refurbishments and developments," says Rathbone.

"Our most recently completed development involved the purchased of a 2.7ha site on the corner of Bader Drive and Orly Ave in Mangere which was a former DB hotel site.

"We subdivided off a large part of the site and sold this to Foodstuffs for a Pak 'n Save development and completed an adjoining retail development comprising Super Liquor, Subway, Kiwi Roast, Nocky Takeaway, Pizza Hut, TAB, Blockbuster and Red Rooster.

In addition to the ongoing Pukekohe redevelopment, other projects that Finstar is currently undertaking include a refurbishment to the existing Clendon shopping centre in South Auckland.

This comprises more than 40 specialty shops anchored by The Warehouse and a New World supermarket.

"Along with redeveloping the existing shopping centre, we are adding more shops to the site.

"Currently we are going through the resource consent process and hope to start construction later this year.

"The expected end value of this project on completion is over $30 million."

Finstar is also refurbishing the Mercer Country Stop beside the Waikato River on State Highway 1 south of Auckland where there is an additional 4ha of land available for development.

At Mt Smart Rd in Royal Oak, Finstar has just started construction of a small convenience retail development which is scheduled for completion later this year.