"It will be sold with a short-term lease back to BiC, providing holding income while the buyer makes plans for the site," he says.
"The property could be purchased by an owner occupier, but the more significant opportunity lies in its redevelopment potential because of its location in one of the city's affluent suburbs.
"A site this big in Auckland's double grammar zone is very rare and makes it particularly well-suited for a mixed use or residential development.
"Auckland Council is advocating redevelopment of CBD fringe sites like this to meet a critical housing shortage, and this site is likely to attract strong interest because of its prime location.."
He says there are several redevelopment options that would probably generate a much higher return than keeping the property in its present form.
One of these would be creating a mixed-use development.
Kermode says this option would be in keeping with the area's evolution in recent years from light industrial and warehousing purposes to mixed use, with more retail, office and residential services.
"There are several mixed use developments in this area and right across the road is a mid-rise commercial building. It's an evolving area which Auckland Council views favourably for higher intensity uses. An example of what could be built on the BiC site is something like Zone 23, a very successful development built about 10 years ago on Edwin St at the foot of Mt Eden."
This complex has 24 two-level apartments with large tiled terraces; double-height lounge and dining areas and large floor plates of up to 300sq m. It has undercover parking, a cafe and commercial space.
"Architecturally, Zone 23 is an attractive building of concrete panels, steel columns, and glass. It appeals to a higher-end buyer, with a lot of European designer interior fittings and on-site services," Kermode says.
"This is the sort of development that would be well suited to the BiC site and residentially it would appeal strongly to the demographic profile in this area, such as a down-sizing older professional couple, or perhaps a family who want their children to attend Auckland Grammar or Epsom Girls Grammar."
Reed says the location has strong advantages for a developer who wants to use the property for residential purposes, including an affluent population, favourable school zoning, its accessibility to a wide range of lifestyle amenities and its transport links to the central business district.
"Mt Eden is one of Auckland's most sought-after suburbs with a high percentage of professionals and management executives who work in the central business district and want their children to go to good schools," Reed says.
"A residential development in this spot would be hot property with buyers looking to get into the dual grammar school zone. Housing zoned for both schools is in very limited supply and sells for a premium price because of the schools' international reputation for excellence.
"Apartments or terrace houses on the site would benefit from its long northern boundary with good exposure to the sun. It's on the doorstep of Mt Eden Domain, the second highest natural point in the region with beautiful views over the city; and it is within 800m of Auckland Domain, providing a lot of walking trails and recreational options for residents."
"It's also a short walk to cafes and restaurants and various specialty retailers including the gourmet grocery store Sabatosa, and The Bloc, a new concept department store.
"The property is also centrally positioned about 2km from Mt Eden Village, Newmarket and the Auckland CBD."
Reed says the property is expected to attract strong interest from local and overseas private investors, developers and owner occupiers.
"The BiC site has appeal to a lot of different type of buyers because of its location, and it could be one answer to alleviating the shortage of high-quality housing stock in Mt Eden.
"It is one of the best offerings we have seen for some time on the CBD fringe presenting the opportunity to create a landmark development."
