Motel 384 suits new density rules

5:00 AM Saturday March 26, 2016 True Commercial

The property operating as Motel 384 is soon to become vacant.

A 22-unit motel on one of Auckland’s busiest arterial routes has been placed on the market for sale — with suggestions that it could be redeveloped into a configuration of medium density housing units.

The property — which has been operating as Motel 384 and is soon to become vacant — sits on a 3123 square metre flat site currently zoned Residential 6A under Auckland Council classification.

Under the Proposed Auckland Unitary Plan, the site will transition into a Mixed Housing Urban zoning — allowing for higher density housing up to three stories high. Under the current zoning only one residential unit is allowed per 375 square metres — meaning only eight units could be built.

The freehold land and buildings at 384 Ellerslie-Panmure Highway are being marketed for sale by Bayleys Real Estate’s Stuart Bode through a tender process closing on April 7.

Bode says the site would most likely be bought for its high-returning development potential, rather than to continue operating as a commercial accommodation provider.

“Older-style motels on large sections across Auckland are a disappearing breed, as their inherent value lies in the land and the location, not the buildings or the business,” he says.

Under its current format, the motel is configured into 14 one-bedroom units, two two-bedroom units, six studio units, and a three-bedroom manager’s accommodation dwelling. The section has a 44.5 metre road frontage and a depth of 70.4 metres.

“The motel infrastructure delivers the potential for considerable holding income to any new owners while the necessary planning and council consenting applications are made. “Supported by a pool of 23 individual units — including the manager’s residence — the property can be let as short term accommodation on fixed tenancies subject to council approval,” Bode says. “All units come with their own self-contained kitchenette style cooking facilities, toilet and bathroom amenities — reflective of a style you would expect to find in a standard 1970s breeze-block Kiwi motel. There is on-site car parking for 30 vehicles.

“The complex comes with a conference centre, laundry and decommissioned swimming pool, so there is the alternative potential of reinstating the motel as a commercial accommodation provider, although it may need some degree of refurbishment.”

Latest bond data from the Government’s Tenancy Services agency shows one-bedroom apartments in Mt Wellington rent for a median price of $365 per week, while two-bedroom apartments in Mt Wellington rent for a median price of $430 per week.

Bode says Motel 384 is in a precinct located between Mixed Housing Suburban, Terrace Housing and Apartment Buildings zones.

“This provides a transition in density between these zones and allows three-story dwellings in locations close to the rapid and frequent public transport network.

“This site sits between two major public transport hubs — Ellerslie and Panmure — which are well-serviced by both rail and bus services,” he says. “Both Ellerslie and Panmure are substantial town centres, with the full range of social and retail amenities in place to support any new residential development in the vicinity.”

Bode says the Mixed Housing Urban zoning pending for the Mount Wellington location allowed for the construction of housing in a variety of sizes and forms — including detached dwellings, terraced housing and low-rise apartments.

“This permutation of development styles will not only increase the supply of housing, but also create diverse neighbourhoods, and provide a choice of housing options in both style and budget,” he says. “For efficient use of such sites, dwellings may be built close to site boundaries provided shading and dominance effects on adjoining sites are minimised. Motel 384 site is a virtual blank canvas development opportunity.”

True Commercial - Stuart Bode%2c Bayleys.jpg

Stuart Bode, Bayleys Real Estate.