Long-standing anchor tenant Bruce Withers Upholstery & Leathercare Ltd has operated a furniture upholstery business for nearly 40 years.
This company recently exercised the last of two two-year rights of renewal on its current lease.
This lease has a final expiry of April 2019, but a fixed rental review in May 2018 will add a further $5200 per annum in rental income until then.
A smaller rear tenancy has a lease expiring in April 2018, with no right of renewal. Kidd says the short-term nature of the leases, with no renewal options, provides the next owner with flexibility and multiple options.
"An owner-occupier could move into part or all of the building, or an investor could attempt to negotiate a new lease with more favourable length of tenure and rental terms with one or both of the existing tenants. Alternatively, an add-value investor could seek new tenants for the space to become vacant.
"Landlords can secure rental increases for refurbished offerings, even with only relatively minor upgrades, in the current very strong leasing market."
Geissler says obtaining tenants would be helped by Wairau Valley's popularity as a business location, excellent motorway and arterial road linkages and large population base.
"The valley's negligible industrial vacancy rate means tenants and owner-occupiers compete for what little space becomes available. In some cases tenants have been prepared to offer more than the asking rental in order to secure premises.
"The supply shortage in the Wairau Valley is unlikely to ease because there is no land left for development. Supply of industrial premises has actually been reducing, due to the increasing level of bulk retail development and car sales activities which has swallowed up many former industrial sites."
The property is on the eastern side of Sunnybrae Rd, about 50m from its intersection with Porana Rd.
The front portion includes 83sq m of showroom and office accommodation plus 263 sq m of workshop/warehouse space and storage areas, with associated amenities.
Central and rear extensions, 161sq m and 176sq m respectively, contain predominantly warehouse/workshop space with amenities.
Each of the three areas has its own roller door access.
The building could potentially accommodate three tenants, spreading the risk to an investor and maximising rental return, says Kidd.
The building is constructed of concrete foundations, floors and block external walls with brick infill in parts.
Geisler says the building's substantial frontage to Sunnybrae Rd increases its appeal for tenants.
"Some street front properties along Sunnybrae Rd have been upgraded to include showrooms due to the profile they offer passing traffic. This could be a possibility for this property, increasing the rental income it generates."
