The completed Pita Pit.
Nine new retail outlets in a 23-unit complex called The Foundation, located in Albany on Auckland's North Shore, will go up for auction later this month offering smaller investors and owner-occupiers the opportunity to secure a slice of the suburb's most recent major retail development.
Comprising a mix of restaurants, smaller convenience and service retailers, The Foundation occupies a large site at 270 Oteha Valley Rd, Albany, acquired by Todd Property Group, one of New Zealand's largest property companies, which is undertaking the development in conjunction with Cappella Property.
Strong interest in The Foundation has meant that all but two of the available units already have committed occupants ahead of the project's completion. A total of 14 units have also been sold and Bayleys Real Estate has been appointed to auction the remaining outlets. Seven of these are investment offerings with new long-term leases of eight to 12 years, with rights of renewal, and the other two are being offered for sale with vacant possession.
They will be offered for sale individually as part of Bayleys' next Total Property commercial and industrial auction on July 30 unless they are sold earlier. They are being marketed by James Chan, Quinn Ngo and Matt Lee of Bayleys Auckland in conjunction with Rosemary Wakeman of Bayleys North Shore Commercial.
The tenanted premises for sale range in size from 56sq m to 193sq m and will produce net annual rental income of just over $31,000 to $66,115, which Chan says puts them in an affordable price bracket for smaller investors and family trusts. Built-in rental growth ahead of inflation is provided by annual fixed rental increases to the Consumer Price Index plus 1 per cent on five of the units, with another lease providing annual rental increases of 3 per cent.
The vacant units measure 55sq m and 193sq m and Chan says these are likely to appeal to owner-occupiers looking to position their business in one of Auckland's fastest growing areas.
The tenanted investments for sale encompass units occupied by:
Pita Pit, which specialises in fast serving healthy food and has over 425 stores internationally with close to 60 in New Zealand. It occupies 58sq m on a 10-year lease producing $31,071 per annum net plus GST.
Bruce Lee Sushi, a growing sushi business with eight stores located across Auckland. It also occupies 58sq m at an initial rental of $31,071 but on a nine-year lease.
Tank Juice Bar, offering smoothies and juices made from fresh fruit and vegetables as well as salads and wraps at 22 locations across Auckland plus other stores around New Zealand. It has a 10-year lease on 56sq m returning $32,602 per annum net plus GST.
Oporto Chicken, with over 100 stores across Australasia, UK and USA specialising in fresh grilled chicken and burgers. It will occupy 107sq m on a 10-year lease producing $61,410 per annum net plus GST.
Whisky to Wine, a new upmarket liquor retail brand which is part of the national Super Liquor group. It will lease 192sq m for a nine-year term, producing $66,115 per annum net plus GST.
Luxury Nails which offers manicures, pedicures and other nail services is taking 114sq m of space on a nine-year lease returning $60,632 per annum net plus GST
Panscape, a cafe and bakery business owned by an independent boutique operator, has a 12-year lease earning rent of $64,017 over 111sq m.
Pita Pit, Whisky to Wine and Tank Juice are already in occupation.
Luxury Nails and Bruce Lee Sushi are due to open soon, followed by Oporto Chicken and Panscape in August. The Foundation's other properties encompass a range of restaurants and takeaway food tenancies as well as a large childcare facility, a Snap Fitness gymnasium and a Bridgestone B Select auto and tyre service outlet.
Larger restaurants include Lone Star, Flying Burrito Brothers, Daikoku, Kitchenette, La Porchetta and Wendy's Hamburgers all of which have already been sold.
Cappella Property's managing director Adam Reynolds says careful consideration was given to the mix of occupants to ensure that the tenants complement each other. "We wanted to secure sufficient hospitality uses as well as smaller food and convenience tenants to establish The Foundation as a recognised food precinct but not have too many competing with each other for business. We've been careful to provide a range of different types of cuisine via well-established and recognised operators so that there is something for everyone.
"We also included a number of other service retailers in the mix that complement and will provide a constant trade for the food and beverage tenancies. Although only a few of the tenancies have opened so far, we are already finding, for example, that gym members are dropping into Tank or Pita Pit for something to eat or drink after they've worked out."
Chan says The Foundation provides high-quality, brand new retail premises designed by Woodham Meikle Zhan Architects and built to current seismic standards.
"It's a very well configured centre. The tenancies are clustered around a large number of car parks accessed via three entry points with illuminated tenancy signage, providing excellent exposure for occupants."
The Foundation is located on a high-exposure corner site on Oteha Valley Road, a main arterial which runs between the Albany Highway and the Northern Motorway, and Appian Way, a main link road to Westfield's Albany shopping mall and North Harbour Stadium.
The site receives substantial main road exposure to approximately 26,000 vehicle movements per day travelling along Oteha Valley Road. It also has frontage onto Corban Avenue, which is zoned for medium density apartments, and Warnboet Lane which runs between The Foundation and the neighbouring Albany Lifestyle Centre.
This is a bulk retail complex which includes national retailers such as Mitre 10 Mega and Freedom Furniture.
Reynolds says the site was chosen because of its strategic, high-profile position in an expanding commercial and residential area.
"It complements the Lifestyle Centre next door and will draw customers from visitors to that centre, as well as from the high volume of passing traffic and the area's rapidly growing population," says Reynolds.
Albany is one of Auckland's fastest growing suburbs and because of its closeness to major motorway networks and bus transport facilities, plus its supply of greenfields development land, it has been designated one of 10 metropolitan centres under Auckland's Proposed Unitary Plan.
This zoning allows for intensive high rise and mixed use development to help cater for Auckland's continuing population and business growth.
Albany is primed for further substantial growth, with an estimated influx of 16,500 new residents projected for the area in the next 10 to 15 years.
A demographic profile of Albany and surrounding residences indicates a high proportion of well-educated, affluent, young and middle-aged homeowners on above-average incomes with one to three children.
What the new valuations mean for buyers and sellers in the city.