Barfoot: We're king of Queen St

Investors are again buying into Queen St as it adapts to the changing needs of commercial office operators.

Barfoot & Thompson Commercial claims to "own Queen St" as far as selling property is concerned.

Writing in the company's latest Insite portfolio, city commercial manager Peter Churchill says "it is no fluke" the agency is so dominant when it comes to selling properties in Auckland's main street.

"Our commercial brokers have built up specific and specialised knowledge making them the most innovative and successful team selling Queen St property and our results speak for themselves," he says.

"Over the past six years the agency's commercial brokers have sold numerous Queen St properties put up for sale in off-market and on-market deals at leading rates worth millions of dollars.

"Many of the properties have been snapped up by New Zealand-based private investors and wealthy individual Asian, German and Swiss buyers - pushing out the traditional institutional investors. It is private investors who realise they arebuying into a finite piece of valuable real estate".

Churchill says investors are again vying to buy into Queen St as it adapts to the changing needs of office, retail, hotel, education and accommodation operators.

"Over the past decade Queen S has become strongly established as a street of two halves: The top end of Queen St is characterised by service retail, hotels, apartments and university activities while the bottom end of the street is the commercial hub with its office buildings, cafes, restaurants and high-end fashion stores.

"Some of the properties sold by the company's city-based commercial brokers have changed use and others have sold two and three times at increasingly higher prices."

Churchill says the changing character of Queen St has been driven partly by the city's residential population growing to 25,000 over the past decade and this is expected to climb to 150,000 in the next 30 years.

"The incredible growth achieved by the two CBD-based universities means the street will continue to evolve as Auckland's premier commercial precinct as well as a desirable residential, hotel and education hub."

Broker Cam Paterson says property in Queen St is tightly held and doesn't often change hands because of its strategic characteristics and the dependability of cash flows.

"Queen St commercial property has proved to be a resilient investment through good and bad times over the past three decades and investors who have taken the time to understand the street's idiosyncratic fundamentals have done well," Paterson says. "While the Barfoot & Thompson Commercial team has been incredibly successful in Queen St sales, it takes skill and experience to sell property there. When our team gets into discussions about Queen St property the old guys can talk knowledgeably about the fundamentals underpinning investment on Auckland's premier street."

Another of the company's brokers, Kim Loo, says the agency can draw on an extensive multicultural broker team with strong and long-lasting relationship overseas to tap into foreign investors.

"We have close relationships with more of Queen St's owners and investors than anybody. These relationships, running across our entire business, have proved invaluable and we work hard at maintaining them."

Broker Wayne Muir says an empty building on Queen St is no barrier to its successful sale. "Often they sell better than a fully tenanted property as the new owner can immediately contemplate occupation or a change in use for the building."

He says Barfoot & Thompson's commercial brokers have also sold a significant number of large and small strata titles with Queen St addresses in addition to entire buildings.

"Entry level strata titles on Queen St are comparably not that expensive and investors or owner-occupiers can buy into prime spots. Owner-occupiers can buy a strata title while taking advantage of the lower interest rates, often making it a cheaper option than renting."