Now showing: Cinema complex sale

Foyer of Whangaparaoa cinema which is leased to Hoyts and is for sale by deadline private treaty. Photo / Supplied

Whangaparaoa's only cinema complex, built 14 years ago on a site opposite the peninsula's substantial shopping centre, is for sale with a long-term lease in place to Hoyts Cinemas (NZ).

The privately owned property is one of a number of trophy investment offerings in Bayleys' latest Total Property commercial and industrial portfolio. It is being marketed for sale by deadline private treaty through Stuart Bode of Bayleys Auckland and Mustan Bagasra of Bayleys Orewa office with offers closing on June 18.

The modern cinema complex has five theatres with 705 seats and a generous carpark allowing 129 cars on the 6394sq m freehold site, says Bode. "It enjoys a monopoly position in the Hibiscus Coast region and draws its customers principally from the Whangaparaoa Peninsula and Orewa areas."

The complex was originally leased to Everard Entertainment, the owner-operator of Berkley Cinemas, but that movie business has recently been bought by Hoyts, which is positioning itself for expansion into digital screening. Hoyts has taken over the 12-year lease Berkley had from 2006, with a nine-year right of renewal from the expiry of the current lease in August 2018.

The property is producing net annual rental income of $350,000, with the next annual review date on September 1.

Bode said this would rise as the annual review was based on 12 months' growth in the CPI (All Groups) from August last year.

He said the modern complex was refurbished in 2007 at a cost thought to be about $800,000 which included an extensive internal renovation including all-new seating, internal finishes and an upgrade of the cafe.

Bode said the 1606sq m building occupied approximately 25 per cent of the entire site, which had potential for further development - although all the carparking spaces were required for their present use for the cinema.

The Mixed Business zoning permits an extensive range of activities on the site, from retail to office and light industrial space, garden centres or childcare facilities.

Mustan Bagasra said the property was likely to benefit substantially from the growth of the region. While the 2006 Census showed that the Rodney District had a population of 89,601 four years ago, Rodney District Council estimated in 2008 that this figure was closer to 100,000 and population projections are for this figure to nearly double over the next 20 years.

Bagasra said the cinema complex also drew from a relatively wealthy catchment. Figures show that a significant proportion of Rodney District's residents live in homes they own - 54.6 per cent compared with 47.1 per cent in the Auckland region and 51.2 per cent for the whole of New Zealand.

With land rapidly being developed around the peninsula's main shopping centre, Bagasra said the population growth and the monopoly position of both the shopping complex and theatres meant both would benefit substantially from the expected residential growth nearby. Whangaparaoa Shopping Centre is anchored by Farmers, The Warehouse and Foodtown.