New Christchurch KFC on long-term lease
The building at 7 Tennyson St has plenty of on-site parking and excellent accessibility. Photo / Supplied
A newly built Christchurch retail property, occupied by a KFC restaurant on a long-term lease, is being marketed for sale as a passive investment in one of New Zealand’s fastest growing areas.
Colliers International’s investment sales brokers Charlie Oscroft and Courtney Doig are marketing 7 Tennyson St, Rolleston, for sale by auction on November 9, unless it sells earlier.
Oscroft says the high-profile, 2781sq m freehold property, is on a new 10-year lease to Restaurant Brands Ltd, which operates KFC in New Zealand, and earns an annual income of $170,000 net.
“This is an opportunity to secure a retail asset in tightly-held Rolleston — one of the fastest growing areas of New Zealand,” Oscroft says.
“Passive investors will appreciate the strong tenant covenant offered by Restaurant Brands — an established dual-listed company that operates international brands in New Zealand.
“The long lease term, with numerous rights of renewal until 2063, should give investors extra comfort in the strength of this asset.”
The 261.5sq m retail building was built after the Canterbury earthquakes and offers plenty of on-site car parking and excellent accessibility.
Doig says Rolleston is the largest centre in Canterbury’s Selwyn District, only five minutes from the Christchurch City boundary.
“Rolleston is identified as a growth and activity centre under the Greater Christchurch Urban Development Strategy, and has quickly become one of the most sought-after and fastest growing areas in Canterbury,” she says.
“Some 92 per cent of Canterbury’s exports go through Rolleston, while the huge Izone Business Hub industrial park has created a substantial employment base for the district.
“The thriving population is serviced by quality amenities including banks, retail shops, food and beverage outlets, three primary schools and two secondary schools.
“Rolleston has a strong sense of community, a new $15m aquatic centre and numerous sporting and other clubs.”
Doig says the wider Selwyn District has consistently been one of the fastest growing areas in the country over the past 15 years.
“This trend seems set to continue, with vast tracks of residential land under development and selling quickly.”
The population is predicted to rise from its current 51,000 inhabitants to close to 64,000 in 2021.
Doig says Selwyn has been ranked the top economic performer in New Zealand, on short and medium-term indicators of population, employment, GDP, and business growth.
“With available land, strong local amenities, quality infrastructure and good employment opportunities, this location is performing well.”
Doig says the area is set to benefit from the construction of the second stage of the Southern Motorway, due to be completed in early 2019.
“The motorway is one of the most significant road infrastructure projects in Canterbury,” she says.
“Once completed, it is likely to halve the travel time between Rolleston and central Christchurch to just 15 minutes.”
Oscroft says the first KFC in New Zealand was established in Auckland in 1971. The global brand now has 99 stores nationwide, 93 of which are operated by Restaurant Brands.
“KFC is a local retail innovator, having transformed almost 70 of its store in recent years, with plans in place to update the rest,” Oscroft says.
“The Rolleston store was purpose-built to incorporate these changes, including booth seating, plasma screens and an attractive, contemporary fit-out.
“The New Zealand store design has been so successful it’s been taken on as the standard for KFC worldwide.
“The brand continues to innovate in New Zealand, with its new urban-style Auckland CBD store allowing customers to place their food orders directly via kiosks.”
As well as KFC, Restaurant Brands operates the New Zealand outlets of Pizza Hut, Starbucks Coffee and Carl’s Jr.
Restaurant Brands is listed on the New Zealand Stock Exchange, and is also a constituent company of the NZX50 Index. Last month, the company also listed on the Australian Securities Exchange (ASX).