The ‘Eden factor’ enhances property
Agents claim 395 Mount Eden Road is one of the best corner sites in the Mount Eden retail strip
Colliers International agents say good retail sites for sale in Mount Eden Village — “perhaps the most affluent such shopping centre in Auckland” — are a rarity.
Broker Peter Kermode and colleagues Adam White and Gawan Bakshi are marketing 395 Mount Eden Rd, a 378sq m freehold property, which is for sale by auction on October 12, unless it sells earlier by negotiation.
“Overseas investors — possibly in Beijing or London — may not fully grasp the status of Mt Eden Village in terms of Auckland’s context and future,” Kermode says. “Although it is relatively small, Mount Eden Village is a tight-knit and vibrant community comprising some of Auckland City’s most dynamic — not to say richest — movers and shakers.
“This property commands a prominent corner site at the northern gateway to Mount Eden Village, offering unparalleled exposure and excellent access to street parking.
“It earns total net rent of $195,000 per year, plus GST, and has a weighted average lease term of over six years.”
A recent fit-out and strong tenant covenant enhances the investment option — but Kermode thinks there is also a strong future angle to consider.
“The property’s current zoning is Business 2, which will be changed to Local Centre under the Unitary Plan, offering potential for a variety of future uses including residential,” he says.
“This zoning allows for multi-level developments and thoughts about future development could include ground floor retail, with a mix of office and residential space at the top. But this would have to be after the completion of the current lease terms.”
“Mount Eden is experiencing incredible change and this property will see all the benefits,” says Bakshi.
“It is only 1.8km from SH1 northbound from Gillies Ave and 2.2km away southbound from Market Road. Ground breaking residential developments in the area include Botanica and Botanica Heritage, while Eden Park is only 1.8km to the west,” says White.
“Mount Eden Train Station is also earmarked for a major refurbishment under City Rail Link plans.”
The property is north-facing and comes with an outdoor dining area. It houses two tenants and includes an APN outdoor billboard. The tenants are Kebab Stop, which has ‘institution’ status in Mount Eden, and Corner Burger.
“Corner Burger is on an eight-year lease term, which began on March 7,” says Bakshi.
It has rights of renewal for two six-year terms, including a market review every four years and annual Consumer Price Index reviews commencing following the first market review. It earns $120,000 per annum plus GST.
Kebab Stop is on a six-year lease, from December 1, 2014 paying $45,000 per annum plus GST. It has one six-year right of renewal and includes a biannual rent review dated from May 1 this year.
“The APN outdoor billboard lease commenced on April 1, 2013 and is for a term of five years with two five-year rights of renewal,” says White.
“The annual rental was recently reviewed to $30,000 with further reviews at each lease renewal date. The three rental streams combine to provide diversification and split-risk income.
“The property is on a broad northern boundary, arguably one of the best corner sites in the Mount Eden retail strip. About 15,000 cars go past every day, giving it a competitive edge over other properties,” he adds.
“Mount Eden is well known as a sought-after inner-city suburb which provides businesses within the strip with an active and stable customer base. This property’s positioning on a strategic corner gives it additional profile and exposure,” says Kermode.
“It services an affluent demographic within Auckland and sits within 2 km from prestigious Auckland Boys Grammar,” adds Bakshi.
“It’s only 4.5km to downtown Auckland, 1km to Mount Eden Reserve and sits among a cluster of successful, longstanding hospitality offerings, including De Post Belgium Beer Cafe, Frasers Café, Circus Circus Café, Mantells and Molten.”
(From left to right) Peter Kermode, Adam White, Gawan Bakshi of Colliers International