Cornerstone site in heart of Newmarket

5:28 AM Saturday May 2, 2015 Colin Taylor

Aerial view of Heartland House in its Newmarket setting.

A prime and full occupied office and retail investment building in Newmarket is one of more than 40 national properties featured Colliers International’s second Portfolio publication for this year.

Heartland House at 35 Teed St is 70 per cent occupied by Heartland Bank on a new eight-year lease. Four other retail tenancies in the building are occupied by Kartell, Bang & Olufsen, Optik Eyecare and Hurdleys to provide a combined weighted average lease term (WALT) of 5.72 years by income as at April 1, 2015.

 “This is a rare chance for an investor to acquire a significant Mixed Use zoned property in the tightly held Newmarket business precinct,” says Andrew Reed who, with colleague Paul Dyson, is marketing it for sale by private treaty closing on May 28.  

Comprising two four-level buildings, the property generates net annual rental income of $1,172,463. It is situated on the highly-visible corner of Teed St with Gillies Avenue which links the State Highway One with the Epsom and Newmarket.

“For individual investors looking for a cornerstone holding to add to their property portfolios, this building is a very desirable asset given its extensive street profile on a major traffic route in the heart of the Newmarket business precinct,” Reed says.

He says the original building, situated on the corner of Gillies Ave and Eden St, was constructed in the 1960s while the newer building, fronting Gillies Ave and Teed St, was built around 2000 and is connected to the older structure.

Both buildings offer modern, refurbished and well maintained office and retail space totaling to 2903 sq m in net lettable area. Around 100 covered and rooftop car parks are within the two buildings.

The single-titled property occupies a 1673 sq m site with three street frontages - most notably a 130 metre prime frontage to Gillies Ave.

35 Teed St, Newmarket - Heartland House - elevated view.jpg

 Aerial view of Heartland House in its Newmarket setting. 

Dyson says the building is highly visible to about 40,000 vehicles which pass by daily along Gillies Ave between the southern motorway and Khyber Pass Rd.

“The scarcity of prime, fully-tenanted investment properties in Newmarket, coupled with the pace of development in the area, will also be a strong draw card for buyers,” Dyson says.

“Newmarket has always been a popular area for property investors, given its status as one of Auckland’s leading city fringe retail and office locations,” he says.

Dyson says the redevelopment of Teed Street and adjacent roads several years ago into a carefully-planned and designed retail destination attracted top-end retail tenants and this has given developers and tenants confidence.

He says Newmarket has long been regarded as Auckland's premier retail destination because of its combination of boutique retail, department stores and mall; cafes, bars, movie theatres, hotels and leisure facilities.

A Mixed Use zoning under both the operative district plan and the Proposed Auckland Unitary Plan opens the way for many future redevelopment options, enabling entertainment, office, retail, residential and educational use.

 “Newmarket also has plenty of parking, efficient rail and bus services, easy access to the motorway system and is only 2.5 kilometres from the Auckland CBD.”

Reed says Newmarket’s urban renewal is gathering pace with the construction of the University of Auckland's Newmarket campus on the 5.2 ha former Lion Brewery site.

“The University of Auckland’s redevelopment of the site over the next decade will be a significant catalyst to further improvement in Newmarket. As the new campus begins to take shape, the positive impacts on surrounding properties are already being felt and there are a number of commercial and higher-density residential developments underway.”

Reed says Heartland Bank offers the security of an excellent leasing covenant and is a subsidiary of NZX-listed Heartland New Zealand Limited.

“It has a diversified asset portfolio, a balanced geographic spread and a widespread depositor base, as well as the backing of a publicly-listed parent company.

Dyson says Heartland Bank was formed through the merger of four well-established financial institutions in 2011.

“It became a registered bank in 2012 but its component parts have a long history in New Zealand, with some dating back to 1875.”

The bank provides retail banking services, lending, livestock and seasonal financing, home and vehicle loans and insurance services and has a strong focus on the rural and farming sector.

Paul And Andrew.jpg

Paul Dyson (left) & Andrew Reed (right) of Colliers International.