Shopping arcade with rare first mortgage on offer

Money may be left in the property for buyers of this two-storey retail arcade at 100 Queens Rd, Panmure. Photo / Supplied

In an unusual move, the mortgagee seller of a shopping arcade at 100 Queen Rd, Panmure, is offering to leave in finance for an approved buyer.

The 1700sq m, two-storey stand-alone arcade on a 979sq m site is in the heart of Panmure's shopping precinct and has three shops on the road frontage, eight in the arcade and two office tenancies on the top floor.

"It's a lot of retail property on the suburb's main road," says Colin Stewart, CB Richard Ellis' investment sales associate director.

The mortgagee has put the arcade on the market after the owner defaulted on payments and will leave in a first mortgage of up to $1.25 million for a new buyer meeting its lending criteria.

"Obtaining finance in this market is often the most critical part of a purchase," Stewart says. "Knowing there is a possibility that money will be left in the property on first mortgage is a big plus for potential buyers,"

Stewart and colleague Jonathan Ogg, who are selling the property by tender closing on April 8, say it will be a bargain opportunity. "There is significant potential to increase cashflow while maintaining attractive and affordable rental rates," says Stewart.

Constructed about 1956, the building was originally a theatre complex. It has undergone upgrades and conversions into an 845sq m ground-floor shopping arcade and 847sq m first-floor offices.

The property returns $125,650 a year and most of the shops are tenanted on leases that run from three years to monthly. The majority have rights of renewal.

Stewart says tenants are paying between $256 per sq m to $162 per sq m. There is one vacant shop and the main upstairs office tenancy is empty.

"If the entire building was leased it could add a significant sum to cashflow. This is a property for an astute buyer, who has the energy and knowledge to bring it up to its full potential."

The upper story is split in two and the front 149sq m tenancy has four offices across the frontage, three additional offices behind and two storerooms. Its entrance is from a stairway within the mall.

The second tenancy at the rear is a 608sq m carpeted open area. The ceiling's prefabricated steel frame and timber purloins have been left exposed. Roof domes and perimeter windows provide natural light. "It would be ideal for a church, gym or dancing school," says Stewart. "Given its location, the upstairs area would be suitable for development into apartments."

A series of rooms at the front of this area have been partitioned off to form an entrance foyer, three offices, a darkroom, two workrooms and a storeroom. Stewart says the amenities are fairly basic and have not been modernised, although the main area is well presented.

Downstairs, the eight shops within the arcade have display windows and doors into the walkway.

There is a central sprinkler system and a security roller door at the entrance.

Angled curb parking is available outside the arcade and several public carparks are within easy walking distance. The property is 200m from the Pilkington Rd intersection.

The Panmure shopping precinct is a large, suburban commercial area extending along Queens Rd from the Jellicoe Rd/Lagoon Drive intersection to Tripoli and Domain Rds. Stewart says the shopping area has a wide range of retail and commercial services, including major banks, medical centre and a hotel.

"Refurbishment of the shopping precinct by the Auckland City Council has included repaving of footpaths, extensive planning, provision of seating and a lighting upgrade. It serves a typical middle-class socio-economic catchment."

After World War II, Panmure has become a major urban area and has created complex transport, job and shopping issues.

The Auckland City Council says Panmure is likely to grow by 850 homes and 2400 people over the next 20 years. It has put a growth strategy in place encouraging new growth and redevelopment focusing primarily on areas already zoned for business activities east of Jellicoe Rd and the shopping precinct.

A new residential subdivision has been recommended for the three blocks north of Pleasant View Rd.