Mt Eden industrial has underlying value
The two industrial properties for sale at 3-7 and 9 Tawhiri St, Mt Eden.
Two industrial buildings on 1489 sq m of land zoned Mixed Use in Mt Eden are for sale that will give a new owner a significant initial cash flow from a new lease to one tenant in place over the entire premises.
The freehold site at 3-7 and 9 Tawari St also has longer term development options, says James Were of Bayleys Auckland who, with colleague Scott Kirk, and in conjunction with James Chan of Bayleys' international division, is marketing them for sale by tender closing June 16.
Were says the property, featured in Bayleys’ latest Greater Auckland portfolio, comprises two warehouse and office buildings of about 1100 sq m and 323 sq m. It is currently producing annual rental income of $248,000 from a four year lease over both buildings from April 2015 to Saito Labels Limited.
“This strategically positioned investment opportunity encompasses two well presented standalone buildings, each on their own separate title, which are fully leased to a long established tenant with over 30 years’ industry experience,” Were says.
“This property also offers substantial underlying land value because of its favourable Mixed Use zoning that allows for residential as well as commercial uses. It has significant future development potential given the property’s sought after Mt Eden location where residential property prices have been soaring because of the suburb’s central location and good access to the CBD and public transport.”
The larger of the two buildings and titles is at 3-7 Tawari Street which has 717 sq m of warehousing with a 23 sq m canopy and 359 sq m of offices plus 19 onsite car parks. It has a land area of 1117 sq m and a July 2014 capital valuation (CV) of $2.3 million of which the land value comprises $1,550,000.
The smaller holding at 9 Tawari St comprises a 372 sq m site with 164 sq m of warehousing and 159 sq m of office space plus four car parks. It has a CV of $760,000 with a $580,000 land component.
Saito Labels has its head office and main distribution facility located at the property and has been in occupation for close to 18 years. The long established company supplies labels,
tags, price tickets and associated printers, scanners and software to a wide range of industries throughout Australasia and also has a base in Brisbane.
It has identical leases over both buildings which run until the end of May, 2019, with two yearly rent reviews and two two-year rights of renewal which, if exercised, would take the final expiry of its lease out to 2023.
The property is located on the northern side of Tawari St between two of Auckland’s major arterials, Dominion Rd and New North Rd. Kirk says the location will benefit from the planned City Rail Link which will join the western line at Eden Terrace and enhance public transport access to and from various parts of the CBD.
Kirk says the property’s current Mixed Use zoning is designed to allow the development of vibrant areas by allowing a mix of residential, business, educational and leisure activities in parts of the city which have easy access to public transportation systems.
He says a similar Mixed Use zoning will remain in place under the Proposed Auckland Unitary Plan but with an increased maximum height allowance from 15 metres to 16.5 metres subject to set back controls from the street frontage.
Permitted activities include offices, retail, residential accommodation, commercial services, entertainment facilities, healthcare facilities, light manufacturing, warehouses and storage plus visitor accommodation and boarding houses.
“This opens up a wide range of options should a new owner be interested in adding further value to the property in the longer term. In the short to medium term, the current lease will generate close to a $1 million in rental income which could be put towards future redevelopment or help pay off a mortgage.”
What’s on offer?
The property: Two warehouse and office buildings.
Location: 3-7 & 9 Tawari St, Mt Eden.
Agency: Bayleys Auckland
Sales method: Tenders closing June 16.
- Future development potential.
- Freehold 1489 sq m Mixed Use zoned site.
- New lease earns annual rent of $248,000.
- One tenant in occupation for nearly 18 years.
- July 2014 capital valuation of $2.3 million.
James Were (left) & Scott Kirk (right) of Bayleys.