A 25-year Farmers’ lease at Whanganui
Whanganui Farmers is part of the Victoria Centre in the main shopping precinct.
This month JLL is marketing a Whanganui property portfolio comprising the city’s Farmers store and several smaller retailers.
On behalf of a UK-based vendor, JLL agent John Binning says 74-96 Hill Street and 85-97 Victoria Ave, will be for sale by expressions of interest, closing October 31.
Binning says they are part of a new retail development in Whanganui’s main shopping area.
Known as the Victoria Centre, this was constructed as part of Whanganui’s 2014 construction boom.
It is home to the properties for sale, which have a council-owned car parking area between them, accessed via Maria Place.
There is a covered walkway running across the carpark, allowing customers to walk directly from the Farmers to the specialty retailers.
The Farmers site for sale on Hill Street has 5,500sq m over two levels, connected by escalators and lifts.
This building is leased to Farmers on a 25-year term at $200 per square metre, which brings in $1,103,798 pa. The Farmers lease commenced on March 1, 2015 and expires in 2040.
On Victoria Street there is 1,180sq m of speciality retail space, which can be split into various tenancies to suit.
This space is vacant but has an 18-month rental guarantee and there are several interested parties in negotiations. This premises has the potential to bring in $383,500pa, making the total income for the portfolio in the region of $1,487,298pa.
“Whanganui is seeing a two-tier retail leasing market with newer well-located premises obtaining a significant premium, compared to older space. Recent reviews of the Whitcoulls and ANZ premises in Whanganui have seen significant increases, confirming Victoria Avenue rentals can go as high as $450 to $500 psm,” Binning says.
“And of course the fact that this is a brand new building means the new owner can expect minimal capital outlay on maintenance.”
Whanganui District has a population of more than 43,600 residents and much of its economy relates to the farming industry surrounding the city. Tourism is becoming a major income stream for the district.
Total visitor spending in the Whanganui District for the year ended June 2016 was $112 million, an increase of 8.7 per cent from 2015.
The region has been identified by the government as an area with growth potential.
The Manawatu-Whanganui Regional Growth Study was released in July 2015. It is an independent report commissioned by the Ministry of Business, Innovation and Employment (MBIE) and the Ministry for Primary Industries (MPI), in conjunction with the region.
The report says “there is real scope to increase incomes and employment in the region through building on its various strengths, such as its fertile productive land, its location as a natural transport and logistics hub for the lower North Island, its internationally renowned tourist destinations, and its strong food innovation and agri-business research history.
“The region has an abundance of under-utilised resources — human, natural and physical — and significant pockets of wealth that could be gainfully employed to improve prosperity for the region and for New Zealand as a whole.”
The latest (June 2016) Regional Economic Report for the Manawatu-Whanganui Region shows a strengthening in economic growth in region, fuelled by increased building activity.
There has been a 43 percent growth in the number of new consents for construction of houses in the region, an increase of 200 houses from the previous year.
The area is seeing population growth from overseas migrants – an 8 percent increase from the previous year. The value of electronic card spending in the Whanganui district increased by 3 per cent between June 2015 and June 2016, which matches the national figure.