One of Gisborne's largest commercial properties - encompassing the Quality Emerald Hotel, close to 2000sq m of office accommodation, 96 carparks, three retail outlets and a vacant two-level character building - has been put up for sale by the Dorchester Property Trust.
On the corner of Gladstone Rd and Reads Quay, overlooking the Taruheru River in Gisborne's central business district, the property is for sale by International Tender, closing April 13 unless sold prior.
It is being marketed by Alan Haydock and Cameron Melhuish of Bayleys Auckland in conjunction with Colin McNab of Bayleys Gisborne.
It is being offered for sale in multiple parcels with potential purchasers able to tender for individual parcels or the property in its entirety.
The parcels are:
• The Quality Emerald Hotel, a 4-star plus Qualmark rated hotel and conference centre plus two levels of fully leased office accommodation on the same title, mostly occupied by Gisborne District Council and providing net annual rental income of $317,505 plus GST. This package also includes 96 car parks in an adjoining building some of which provide rental income from long-term leases with the balance incorporated into the hotel operation.
• Three affordable retail units, each on their own separate title. One is vacant, and two leased to long-standing tenants and providing annual rentals of $60,030 and $13,086. They can be tendered for individually or together.
• A vacant two-level heritage building at 9-11 Gladstone Rd, with each floor on a separate title and available for purchase individually.
"There is a big opportunity for hotel operators and add value investors to secure the entirety of this prime Gisborne package or to choose one or more of the individual options available," says Haydock. "In addition to the hotel operation there is over $400,000 of annual income being generated by the office, retail and car parking components so there is a good spread of risk across multiple sectors of the market."
The Dorchester Property Trust is part of the NZX-listed Turners Group and at one stage owned four hotels but is progressively selling these down. The property was developed in the mid-2000s by a company associated with Russian businessman Serguei Sonkin.
The 48-room hotel was built in and around the former Quay Point office building, some of which was retained.
Six residential apartments, which were added on top of the building, were sold individually and a four-level parking building was built alongside the hotel along with new ground floor retail space. All the buildings have a B-Grade seismic rating in excess of 66 per cent of New Building Standard.
Haydock says the hotel offers a range of fully equipped room types from studios through to spacious executive suites. "Many have good-sized decks either overlooking a substantial courtyard and pool area or across the Taruheru River."
The hotel has a restaurant and bar that opens out on to the pool, a gymnasium, reception and administration areas plus a manager's apartment on a separate title. It has an independent Qualmark rating of four and a half stars (meaning that it consistently achieves high quality levels with a wide range of facilities and services) and a Qualmark Silver Enviro Award (signifying exceptional levels of resource management and social responsibility).
The offices, which total about 1910sq m, plus 244sq m of deck area, are located on levels 3 and 4 of the original Quay Tower. The Gisborne District Council occupies 1554sq m of this space plus a substantial 139sq m north facing deck. Fujitsu NZ Limited and The Maori Trustee lease smaller amounts of space.
"The office accommodations are well presented with the council tenancy featuring a modern fit-out nearing completion which will remain in the landlord's ownership," says Melhuish.
"The air-conditioned floors have good natural light as a result of the building's corner position and tenancies and enjoy views over the river and inner harbour."
The three ground retail units are part the new building portion of the property. Mehuish says the largest unit of approximately 342sq m is in a high profile corner position with frontages to Gladstone Rd and Reads Quay and is occupied by the well-performing The Rivers Irish bar which exercised the first of three five-year rights of renewal in March 2014.
The two smaller units, approximately 73sq m each, have frontages to Gladstone Rd. One houses the electorate office of East Coast MP and Minister of Social Development Anne Tolley which exercised a final three-year right or renewal in June 2015. The other unit is vacant.
The 324sq m building at 9-11 Gladstone Rd is largely a bare shell following structural strengthening works. It is unoccupied although is often incorporated into events held by The Emerald Hotel.
Melhuish says it provides significant versatility for owner-occupiers wanting character space in a prime Gladstone Rd position.