The office tower for sale at 1144 Pukaki St, Rotorua.
The office tower for sale at 1144 Pukaki St, Rotorua.
A five level office tower underpinned by primarily government tenants on the northern edge of Rotorua's central business district is being promoted as an ideal investment property.
The 3653 sq m Pukaki Centre on a 1711 sq m flat site at 1144 Pukaki St is owned by the Rotorua Energy Charitable Trust and is featured for sale in Bayleys' latest Total Property magazine.
The Trust was established in 1994 using some of the funds resulting from the corporatisation of the Rotorua Electricity Company and it is now reassessing its property portfolio as part of its wider strategic investment and charitable goals.
Mark Rendell of Bayleys Rotorua and Mark Hourigan of Bayleys Wellington are selling the Pukaki Centre by tender closing on August 12.
"This is the kind of property with the credentials to motivate investors and which private individuals and family trusts are looking for in today's market," Rendell says.
"In terms of Rotorua city, the property is really well-located. It's surrounded by professional business tenants and is near to the council building and the district court. It's also close to the lakefront and handy to popular Eat Streat - Rotorua's hospitality hot spot which underwent a $2 million upgrade last year and which is popular with CBD workers because of the range of cafes and bars conveniently clustered together..
"The Pukaki Centre has great natural light, faces north, looks over the picturesque Village Green and has 40 car parks with 11 of those under cover making it very appealing when securing tenants."
The late 1980s built freehold property has a rateable value of just over $4.9 million and earns net annual income of $435,691 plus GST.
The building has multiple rental income streams, with the Ministry of Education occupying around 1700 sq m across the fourth and fifth floors, subleasing part of the fourth floor to Inland Revenue Department and also having ground floor storage space. Lakes District Health Board is on the third floor and some legal firms have space in the building.
The lease terms across the building vary with Lakes District Health Board committed until mid-2020, and the Ministry of Education's lease expiring at the end of 2026 with additional rights of renewal.
Refurbished floors feature modern open plan office space.
Construction is of reinforced concrete foundations, pillar and beam structure with suspended concrete floors and steel-framed roof.
The property has a seismic assessment of 73 per cent of new building standard (NBS) equivalent to a Grade-B, or low risk building.
Rendell says three of the floors have recently been refurbished to a very high standard which should give prospective buyers a good level of confidence in terms of the inherent value of the asset and its future appeal to tenants.
Main pedestrian access to the building is from the southern side of Pukaki St to the main entrance foyer and lift, and there is staff access from the level one parking area. Vehicle access to the external car park is available from Pukaki St and there is a service lane to the full periphery of the site.
"The underlying testimony to suitability of this location is further enhanced by the commencement of Rotorua's first inner city building designed to support Lakes Council's new Wood First policy, nearby," Rendell says.
"The council policy is aimed at encouraging use of wood products and supporting the Rotorua district's vital wood industry. Local developer Ray Cook of R & B Consultants is undertaking a new design build and lease back of premises for the Accident Compensation Corporation in Pukaki Street not far from the Pukaki Centre.
Mark Rendell of Bayleys Rotorua.
"It is good to see new investment in Rotorua's commercial property scene as it all helps to make the city a vibrant place to do business."
Rendell says that the recent announcement by Air New Zealand that it has extended its Auckland to Rotorua return flight offerings for the Q300 aircraft to include an afternoon schedule makes the city an appealing proposition for Auckland based property investors.
"Those investors who are finding themselves chasing their proverbial tail in order to secure investment properties in Auckland may be keen to broaden their portfolio to include regional properties," he says.
"The improved flight schedule between the two cities will make a bricks and mortar investment in Rotorua all the more accessible for those from outside the region."
• Multiple income streams from government and legal tenants. • Net annual income of $435,691. • Building area of 3653 sq m. • Freehold 1711 sq m flat site. • Three floors recently refurbished to a high standard.
