Grey Lynn retailer a super performer

The 11,207sq m Countdown supermarket corner site sits at the top of Richmond Rd. Photo / Supplied

The sale of Grey Lynn's Countdown supermarket "represents one of the finest opportunities around to acquire a premium property asset with the best possible fundamentals", says Peter Herdson, national sales director for Colliers International.

The strong-performing city-fringe supermarket sits on a high-profile site at 271 Richmond Rd, Auckland, and is being marketed by Herdson and Colliers broker John Green, who are selling it by deadline private treaty closing at 4pm on Thursday, July 22.

"Since being developed by Woolworths, this property has been the jewel in the crown of a number of large portfolio sales but has not been available to the market as a standalone investment opportunity," Herdson says.

"It has everything a serious investor could possibly want - it's a recently refurbished property on a large freehold site with three street frontages in a prominent location, a rock-solid tenant returning in excess of $1.3 million net per annum, a lease with years yet to run and a favourable Business 4 zoning.

"This sale represents an excellent chance for major property investors to strengthen their portfolios."

Herdson says the supermarket purchase is ideally suited to family trusts, private syndicates and high net-worth individuals who are currently "by far the most active purchasers in the market".

Sitting on a freehold 11,207sq m corner site, the supermarket has a net lettable area of 4396sq m with 221 car-parking spaces, of which 45 are secure basement staff spaces.

"This Countdown is a modern and well-presented supermarket with offices and staff amenities," Green says. "Originally built in the 1970s, it was converted to a Woolworths supermarket in 1998. It was completely refurbished again this year, when it was upgraded to a near-new standard and rebranded as a Countdown."

The ground floor is on the same level as the car park and comprises the main 2620.72sq m retail area.

The building's western part has a lowered feature ceiling with recessed lighting giving the store a modern entrance. The main entrance at the front of the building leads into a trolley bay area beyond which is the entry to the supermarket. An ATM machine with exterior access is on the western side of the entrance.

Fronting the car park in the northwestern corner is the main warehouse and truck-servicing area. First-floor offices are at the rear and comprise a training room with several small offices, staff lunch room and amenities.

Concrete hardstand parking makes up the rear half of the site with access along a tarsealed roadway on the eastern side of the main building. Car-park entry and exit is off Richmond Rd.

Herdson says the supermarket's lessee, Progressive Enterprises, which owns and operates the Countdown, Woolworths and Foodtown brands, is "a super-tenant in a year-on-year revenue growth sector" with over 40 per cent of New Zealand's grocery market. In the March quarter the value of total retail sales rose 0.5 per cent - the fourth successive quarterly increase.

"And the retail sector has made particularly good progress of late, recording 4.4 per cent total returns for the year. We understand this supermarket is one of the company's best performers and it was one of the first to be rebranded."

Progressive Enterprises began a 15-year lease for the supermarket on August 30, 2004, so more than nine years are left on the current lease term, with three rights of renewal of six years - taking the final lease expiry to the end of August 2037. Rent reviews are set at three-yearly intervals, with the next review due for August 2013.

The block is strategically located on Richmond Rd, an arterial route running west from Ponsonby Rd and within a 10-minute drive of the CBD. It has a 75m frontage on to Richmond Rd, 140m frontage to Regina St and a 40m rear frontage to Livingstone St.

Green says the catchment area includes the affluent suburbs of Grey Lynn, Ponsonby and Herne Bay.

The area's popularity for residential purposes has prompted the development of both townhouse units and commercial developments.

"As a result," says Green, "this property also presents a superb land-banking opportunity in an area where land values continue to escalate."