Auckland CBD property with options

The 13-level CBD building, at centre, in Wakefield St, has a mix mainly of education and retail tenants.

A medium sized Auckland CBD commercial property with a mix of mainly education and retail tenants is for sale offering an opportunity for an add value investor or owner occupier.

The 402sq m 13-level building on a 607sq m site at 3-15 Wakefield St is being marketed for sale by deadline private treaty closing on December 1, unless sold earlier by negotiation. Featured in Bayleys' latest Total Property portfolio, it is being marketed by Stephen Scott and Colin McKenna of Bayleys' Auckland office.

Built in 1976-1977 by Fletcher Construction for what was then the Inland Revenue Service (IRD), the concrete framed and floored building has an Initial Evaluation Procedure (IEP) seismic rating of 90 per cent of New Building Standard (NBS).

It comprises two levels of retail space totalling 718sq m with 3305sq m of office space above.

Scott says the property is almost fully leased and is producing net annual rental income of approximately $984,000. Its two largest education tenants are Quantum Education, which specialises in travel, tourism, business and computing courses, and the Wellington Institute of Technology (Weltec), which has been operating for over 100 years and provides for a comprehensive range of courses to almost 11,000 students. Its main campuses are in Petone and Wellington's CBD but it also has a presence in Christchurch as well as Auckland.

The two main retail tenants are a copy centre and a mini supermarket. The office floors comprise three podium levels of 431-432sq m and another seven levels above of 250-254sq m, with men's and women's bathroom facilities on every level.

McKenna says a number of leases are short term and this provides options for purchasers.

"It opens up opportunities for an owner occupier to secure contiguous floors and would also enable an investor to strengthen the property's leasing profile. The current owner already has a well-established education provider very interested in leasing the top three floors for six years from early next year as well as taking building naming rights. This would increase the building's net indicative annual rental income to just over $1 million," says McKenna.

"However, the vendor has decided not to finalise any new leases at this stage to leave all options open for the next owner."

The building is serviced by two 11-person lifts, has fire sprinklers throughout and has after-hours security access. Scott says the office floors generally provide carpeted, air-conditioned accommodation with suspended ceiling tiles and fluorescent ceiling lighting. Three floors have been refurbished with new suspended ceilings and light fittings.

Scott says there is a light and air easement registered on the title which restricts any future development above the podium levels, other than the existing tower. "This maintains the natural light and views on the floors above Level Four which increases the property's leasing appeal for tenants.

"The property is also in a high-profile location just one building away from Queen Street and in the heart of the CBD's education precinct close to both the Auckland University of Technology and University of Auckland."

Scott says the property is centrally located within the Aotea Quarter, Auckland's civic, cultural, arts and entertainment centre which includes the Auckland Art Gallery, the Central City Library, Aotea Square, Auckland Town Hall, Aotea Centre, Civic Theatre, plus Auckland Council's administrative offices.