A street level view of 74 Newton Rd occupied by Golf Warehouse and other retail tenants.
A street level view of 74 Newton Rd occupied by Golf Warehouse and other retail tenants.
A strategically-located Auckland commercial property with a high profile to the State Highway 16 north-western motorway and which has been owned by the same family for over 19 years is now on the market.
"This is an excellent split risk investment with three solid tenancies," says Dave Lane of NAI Harcourts North Shore who is marketing 74 Newton Rd, Eden Terrace, for sale by negotiation. He is also marketing a retail property in four titles for sale on the North Shore's busy Lake Rd.
Lane says the standalone Newton Rd building of 3619.25sqm on a freehold site of 2113sq m generates annual rent of $666,000 from three commercial tenants - Golf Warehouse, Just Laptops and the Christmas Parade. There is also some income from billboard signage.
"The property receives a huge amount of exposure to traffic that is unmatched by any neighbouring commercial properties which include warehouses, retail and office buildings. It is very visible on an elevated site fronting onto busy Newton Rd and abutting the north-western cycleway. Since the cycleway is owned by the council, the exposure is unlikely to be lost from this site in future," Lane says.
Newton Rd is the main service road from Ponsonby and Grey Lynn to Eden Terrace. About 100 metres down the road are the on-and-off ramps for the SH16 motorway.
"Golf Warehouse, New Zealand's leading golf retailer, occupies a substantial bulk retail and administration area within the complex," says Lane. "This is their flagship superstore and it has become a local landmark.
"An additional separate retail tenancy on the same level is occupied by Just Laptops, while to the rear of the property, with dual entry from Randolph St, is a high stud warehouse storage area, partly occupied by Golf Warehouse and with the balance leased to the Christmas Parade."
Lane says the building was constructed in 1977 as a head office, retail and distribution centre for Passmores Liquor.
The general structure of the building is of reinforced concrete frame with a steel portal roof. The floors are supported by precast double-tee spanning members and most walls are infilled with double-skin concrete block.
Under the Auckland Unitary Plan, the property sits in a Business Mixed Use zone which, using a height variation control, will allow for development up to 32.5 metres - up from a current height restriction of 15m.
This elevated view of 74 Newton Rd depicting its strategic location in Eden Terrace.
Lane says Golf Warehouse has a 10-year tenancy paying $400,000 in rent per year plus GST and outgoings. The sports retailer occupies 1826sq m of the building, including office, basement storage and part use of the high stud warehouse. Outgoings are 100 per cent recoverable from the Golf Warehouse including council rates and building insurance.
The Christmas Parade rents 1563sq m of the high stud warehouse, as storage for some of the equipment and floats used in the annual Farmers Santa Parade on Queen Street, paying rent of $200,000 per year plus GST.
"This leased space at 74 Newton Road is considered essential to the continuation of the Santa Parade," Lane says.
"The third tenant, Just Laptops leases 229.5sq m of retail and office space for $60,000 per annum plus GST and they say that this location works very well for them.
"In addition, income is generated from signage billboards fronting Newton Rd with Phantom Billstickers taking advantage of the high exposure location."
The property has 26 on-site car parks offering good parking for clients of the retail tenants. "This is a convenience that is not so common in the immediate location," Lane says. In addition to the Newton Rd entrance, there is also an easement in place allowing access from Cargill St.
Lane says at a time when commercial property listings are low, it is expected the retail building complex will be snapped up by a savvy investor.
"This Newton Road property ticks all the boxes with a high-profile location, in a busy area, with secure tenants, a long-term lease and returning $666,000 per year. Situated in such a desirable location there is also the potential for rental growth and we expect it to generate significant interest over the coming weeks despite the festive season."
Over on the North Shore, Lane is marketing for sale by negotiation a 447sq m building fully-occupied by four retail tenancies at 453-459 Lake Rd, Takapuna.
The 528sq m freehold property is in four tenancies with a wide frontage onto the retail strip of Lake Rd and generates annual rent of just under $153,000.
The tenants are Takapuna Liquor Spot, Ezone Computers Limited, Pizza Club and Sunvital.
• Takapuna Liquor Spot has a three-year tenancy, with two rights of renewal of three years until October 2023 paying $54,297 per annum for 140.4sq m. Liquor Spot is part of one of the largest liquor chains in New Zealand with 216 stores nationwide.
• Ezone Computers Limited has a six-year tenancy, with two four-year rights of renewal and a final expiry date of August 31, 2023 paying annual rent of $39,566 for 93sq m. Ezone sells computer products and services including PC systems, software, parts and performs a broad range of repairs and IT service.
• Pizza Club has a three-year tenancy, with two three-year rights of renewal giving a final expiry date of April 30, 2021 and paying annual rent of $29,550 for 59.3sq m. Pizza Club has eight stores Auckland-wide with further planned.
• Sunvital, a licensed tanning studio, occupies the rear tenancy on a tenancy running for a period of four years, with two three-year rights of renewal and a final expiry date of May 7, 2025. The Sunvital studio, which pays annual rent of $29,500 for 14.3sq m, has been in operation in Takapuna for more than 10 years.
Three of the property's tenants are at the front of the building and the fourth occupies space at the back.
"This location surrounded by office and retail buildings and affluent residential streets has high pedestrian traffic and attracts shoppers from all over the North Shore," Lane says. "The vendor says he has never experienced a vacancy while owning the property."
The property at 453-459 Lake Rd, Takapuna, comprises four retail tenancies.
As well as the security and steady income from a split risk investment, this part of Takapuna is earmarked under the Auckland Unitary Plan to have increased height limits ensuring greater opportunities for development in the future.
"The area will be designated a Metropolitan Centre, which makes it even more attractive for investors with the zoning second only to a City Centre in overall scale and intensity," says Lane. Under the new plan, buildings are permitted to reach a height limit of 72.5 metres, or 18 storeys, with allowed activities including: dwellings; commercial services; food and beverage; offices; and retail.
"In addition to the attractiveness of future development, a multi-tenanted property rarely becomes available in Takapuna, "Lane says.
"This is a low risk investment property in a first-class beachside city location with strong prospects for growth."
Construction is a concrete block with an iron roof. The site is a rectangular shape with a level contour, with a 14.95m street frontage on Lake Rd. The rear of the building is accessed via the service lane running behind the properties fronting Lake Rd.
Lane says the growth expected in Lake Road is backed by local government, key stakeholders and the Takapuna Beach Business Association.
"This property at 453-459 Lake Road is arguably one of the best investment properties on the market with solid multi tenanted income, accompanied by unlimited potential in a top location."
