Kaiteriteri beachside property hub

The Beached Whale bar and restaurant occupies one of the properties for sale at 8-10 Inlet Rd, Kaiteriteri. Photo / Supplied

The land and buildings — but not the business operations — which house a hospitality hub in the beachside town of Kaiteriteri, are for sale.

The properties at 8-10 Inlet Rd in the seaside resort, near Abel Tasman National Park, are occupied by the Kaiteriteri Beach Lodge and adjoining Beached Whale; whichconsist of a restaurant and bar, motel-style accommodation, and backpackers' dormitories. There is also an owner/manager's residence.

Number 8 Inlet Rd houses the 900sq m Kaiteriteri Beach Lodge and Beached Whale operations now generate rent of $240,000 per annum.

Set some 50m from the beach, the properties sit on about 2182sq m of freehold land in two titles. They are being operated as separate entities by the same tenant, as follows:

• The 80-bed two-storey accommodation arm of the enterprise encompasses a broad selection of room configurations. These comprise bunk-style four, six and eight-bed dormitories and single rooms, through to motel-grade units with en-suites. Each level has shared bathroom and toilet facilities servicing its dormitories, with the communal kitchen located on the ground floor.
• Immediately next door are 12 portacom cabins converted into accommodation units and supporting shower and bathroom amenities.
• Next along is The Beached Whale bar and restaurant, which is licensed to serve up to 80 patrons, is located next door. Famous for its "summer vibe", this open-plan/high stud venue has extensive indoor and outdoor seating, with the alfresco areas on the street frontage and at the rear courtyard of the property.
• At No 10 Inlet Rd stands the two-storey, three-bedroom 108sq m owner/manager's home. This now generates annual rent of $26,000.

The land and buildings and owner/manager's residence being marketed for sale by negotiation through Bayleys Nelson, and they feature in Bayleys' latest Total Propertyportfolio magazine.

The properties are to be sold with new leases offered under negotiation; and long renewal terms sought with the new owner.

Bayleys Nelson salesperson Gill Ireland says it's rare for commercial-grade investment opportunities of this dynamic to come onto the market in the Western Tasman region.

"Accommodation lodges come onto the market from time to time, as do B&Bs, and occasionally the buildings with bars or fast food outlets as tenants – but certainly nothing offering commercial accommodation and adjoining hospitality operations on this size and scale," she says.

"Usually, such properties coming onto the market are advertised as land, buildings and business for sale. The Inlet Rd duo are purely investment properties – with the current business operator well entrenched in the local community, and looking to remain as the long-term tenant."

She said both the new lease negotiations could be undertaken in conjunction with the land and building purchase in order to reflect any new owner's potential future uses of the two sites.

"From a tenant's perspective, Kaiteriteri Beach Lodge and Beached Whale operate in a symbiotic nature – with guests staying in the accommodation enjoying the convenience of have a casual dining restaurant and bar right next door. And for Beached Whale, that arrangement delivers high customer numbers year-round – particularly over the summer seasonal months," Ireland says.

She says the properties sit directly across the road from the Kaiteriteri Beach Holiday Park campground. Number 8 Inlet Rd is zoned commercial 8A under the Tasman District Council plan; Number 10 is zoned residential 9S.

"It's unusual to find neighbouring commercial and residential properties offered for sale with commercial leases in place. But with the residential component integral to the operations of the hospitality businesses next door, the arrangement underpins both entities."