The land and building currently occupied by the Baaa Sports Bar and Grill - which has stood the test of time as one of Dunedin's enduring local pubs - are now for sale as an investment property.
Located at 746 Great King Street, the North Dunedin corner site sits in strategic position bordering arterial route State Highway 1, with a main entrance located off north-facing Howe St.
Marketed for sale by Bayleys Dunedin in a tender process closing May 17, salesperson Robin Hyndman says that the building's position and existing land use rights present a valuable passive investment opportunity.
"The immediate area surrounding Howe and Great King Streets is densely populated with residential housing, and the main body of the city's motels," Hyndman says.
"This makes North Dunedin an extremely viable location for investment with the property located on a Golden Mile of sorts. This enables the tenants to capitalise on foot traffic from the neighbouring motel precinct; from a strong local patronage and from its location as a thoroughfare between the Otago University and Otago Polytechnic campus."
Originally constructed in the 1980s, the freehold property has been used as a hospitality venue for 20 years, previously trading as Harley's Bar and Bistro, followed by the Baaa Sports Bar and Grill, from June 2007.
With a land area of about 405sq m, the 390sq m building covers most of the site, with the exception of standing room outside the entrance, and a single carparking space off Howe St.
"Mostly a single story construction, there is an office and staff amenity neatly positioned in the ceiling space," Hyndman says.
"Zoned Residential 3, Neighbourhood Convenience Centre, the property is located in a prime pedestrian catchment area and is the only local pub to service 10 motels within a 500 metre radius.
"With nearby commercial properties tightly held, the area is considered a very desirable location for investment, as evidenced by the inquiry we have received from investors based in other New Zealand cities."
A proven long-standing operator, the Baaa Sports Bar and Grill holds a 10-year lease for the property commencing June 1, with two rights of renewal at five years each.
"Outgoings are paid for by the tenant, and rental reviews are conducted in line with the Consumer Price Index (CPI)," says Hyndman.
The last of a dying breed, the Baaa Sports Bar and Grill has endured what has been a challenging period for many of Dunedin's popular taverns and bars.
"The past seven years have seen a directed crack-down on establishments collecting revenue from the sale of liquor, as the Dunedin City Council (DCC) and the University of Otago take increasing measures to discourage new hospitality venues within the area.
"Tougher regulations have divided the community and played a part in the closure of many popular establishments including The Bowler and the Gardies Tavern which have been purchased by the university and turned into lecture theatres," says Hyndman.
"It's an unfortunate situation for the local hospitality scene, however it has limited competition for the tenants which have lasted as a performing local pub with a consistent stream of business.
"It's all about location, location, location for the Baaa Sports Bar and Grill which, while attracting a strong student crowd for the later trade, has succeeded thanks to its mixture of clientele.
"Strong relationships with neighbouring accommodation providers have resulted in a charge-back service for meals, while TAB licences and the presence of 18-gaming machines have also enhanced the appeal of the business - avoiding the errors of many fallen establishments which have relied too heavily on a particular group for patronage."