‘Rare investment’ property on city fringe
The Eden Terrace property occupies a prime corner position. Photo / Supplied
JLL describes a tenanted property for sale in the inner-Auckland City suburb of Eden Terrace as having huge development potential.
Agent Nick Cape is marketing the two-storey commercial building at 65 New North Rd.
The building offers 1112sq m of office accommodation, plus basement car parking and is positioned on a 1041sq m allotment.
Cape says the Eden Terrace property occupies a prime corner position on Auckland City’s rapidly developing fringe.
The property, on the corner of New North Rd and Exmouth St, is for sale through an expression of interest campaign, closing March 31.
The building constructed in the 1980s has an New Building Standard (NBS) rating of 96 per cent.
Its ground floor is leased by Careers NZ, on a three-year term expiring in August 2019.
“This property would provide an incoming purchaser with a gross rental of about $198,000 per annum, with the ability to increase that by leasing out the first floor office space, which is currently vacant,” Cape says.
Tom Barclay, national research manager for JLL says given a Mixed Use zoning under the Unitary Plan, the property has several future development possibilities.
“There is also the benefit of holding income from the sitting tenant which could be increased via letting of the remaining vacant space”.
Cape says in future the building could be used for residential accommodation; it is well set up for such a use, given its basement and open car parking provisions and the desirable city fringe location.
“The height limit of the Mixed Use zone may allow for additional accommodation on top of the existing building, adding to the value of the property,” says Cape.
Barclay says there’s been strong sales activity in city fringe localities over the last 18 months, with stock being tightly held in the core CBD.
“Fringe locations such as Eden Terrace are popular with local buyers in the $5m to $10m price bracket, buyers who understand the idiosyncrasies of Auckland’s dynamic commercial property market”, says Barclay.
“There is still a substantial weight of capital in the market looking for a home and sites with development potential and solid holding incomes have been in high demand”.
Infrastructure also plays a big role in investor mind-set and the improvements to key transport routes by road and rail will continue to improve the desirability of fringe CBD locations like Eden Terrace for both commercial and residential accommodation.
Cape says the property is only a few minutes walk from the Mt Eden train station. “Once the City Rail Link is complete there will be direct rail access into the CBD at high frequencies.
“This will increase desirability of Eden Terrace for residential living and for office occupants who will be able to enjoy more affordable office rentals but still have easy access to the CBD,” he says.
“Whether the new owner decides to hold this property for passive income as an office building of realise residential development options down the road, Eden Terrace is a key location to invest for the future.”