"Having traded from this site for nearly two decades, Restaurant Brands Limited renewed its lease in 2017 for a further six years, with renewal options through until 2035," he says.
The City Centre-zoned property has a capital value of $1,570,000 and earns net annual rent of $134,916 plus GST.
The tidy Porirua property follows a fairly typical KFC format with the 230sq m building comprising commercial kitchen, counter space, restaurant dining area, public bathroom amenities, staff areas and chilled storage. There is also a drive-through with a small canopy and a covered docking area for deliveries to the rear of the site. The balance of the 1855sq m site is fully sealed with 21 marked car park spaces, good access and some landscaping.
A recent seismic assessment completed by Spencer Holmes categorises the building as 'A' grade with a rating of 95 per cent of new building standard.
"This is an example of a classic passive investment – the likes of which seasoned investors are always keen to have in their portfolio" says Sherlock.
"Bayleys has facilitated a number of sales of KFC-occupied properties throughout the country in recent years and all have been actively competed for by enthusiastic investors.
"The fast food asset class is sought-after, especially when the properties are anchored by well-backed operators with decent-term leases."
Restaurant Brands recently reported that KFC New Zealand sales rose 7.8 per cent to $319.6m in the 2017 financial year, up 6.2 per cent on a same-store basis, with fourth-quarter sales rising 7.1 per cent to $75.7m, up 5 per cent on a same-store basis. Store numbers rose by two in the year to 94, with one outlet opening at Christchurch Airport during the quarter.
Sherlock says Porirua city is in pretty good heart commercially and Porirua city councillors recently voted to spend more than $5m upgrading the council headquarters which are located around 120m from the KFC site.
Further, a $21m adventure park proposed for the hills west of Porirua is being cited as a potential "game changer" for the city's economy and is expected to attract walkers and mountain bikers. Resource Consent is yet to be obtained for the park which would be funded and built by Select Contracts, the Canadian company behind the Christchurch Adventure Park. It is hoped that work on the park could begin this year.
