Elevated view of the large showroom and warehouse corner property for sale at 282-286 Church St, Penrose.
A big Penrose showroom and warehouse property leased by two well-established tenants is for sale as a 'hands-off' investment opportunity with a diversified and solid income stream.
"This building offers compelling investment fundamentals," says Andrew Hooper of Colliers International's industrial team who, with colleague Ben Cockram, is marketing 282-286 Church St for sale by deadline private treaty closing on October 13 unless is sells beforehand by negotiation.
"As a well-functioning asset in a high profile location, the property makes an excellent, hassle-free proposition for buyers at a time of increasing demand for Auckland industrial property," says Hooper.
The building was constructed in the late 1980s and has a total floor area of 3758 sq m. It occupies a freehold 5550 sq m corner site spread over three titles.
Hooper says it encompasses a mix of quality office, showroom and warehouse areas with a very high-profile street frontage to a main arterial road.
"The modern, partially glazed frontage provides excellent visibility for the tenants."
Warehousing, showroom and office space is complemented by associated amenity areas and is accessed via roller doors. Off-street customer car parks are provided on-site.
"A flexible layout allows for future division to accommodate a larger number of smaller tenants," Hooper says.
Tile Warehouse, a well-known national brand, occupies the property along with vehicle sales specialist No Reserve Cars, paying total net rent of $411,861 annually.
Tile Warehouse has 25 branches nationwide and operates its national head office from the property which is has occupied for the past 15 years.
"Tile Warehouse is very well established here and its management and staff like the location because it's close to the central business district," says Cockram. "It's a really accessible and central spot for architects and designers to visit and also for stock deliveries."
The recently renewed its lease has a final expiry date of September 2020, if a further right of renewal is exercised.
No Reserve Cars holds a lease extending to March 2021, including rights of renewal. The business, which sells European and Japanese used cars, was formed in September 2011 and moved into the property in April this year.
"We expect this asset will appeal to many buyers who are attracted to industrial property investments that are leased to more than one tenant, because this reduces the income risk if a vacancy arises."
Cockram says investors will also like the building's passive, low maintenance characteristics.
"In the current low interest rate environment, many investors are looking to commercial property as a way to generate better returns than those offered by banks. This type of property is exactly what buyers of commercial property are looking for - a top location, functional building and an excellent leasing history that combine to provide a worry-free passive holding.
"Penrose is very popular among occupiers with vacancy rates extremely low and prime vacancy now non-existent. This shortage is placing upward pressure on rents in the area, which is likely give the property's new owner the possibility of increasing the income in the future."
The Business 5 zoned property has three road frontages providing excellent access, says Hooper. "Being near major road transport links is also a key benefit of this location with the property located mid-way between the southwestern and southern motorways. On-ramps to both motorways are only 2 km from the building."
Hooper says Church St was formerly a traditional industrial, manufacturing and warehousing area but has an increasing number of buildings have been converted to showroom and office uses with occupiers attracted to the considerably cheaper rentals than central city rates. "Excellent transport access and a location within easy reach of the Auckland CBD and airport have also contributed to the Church Street area undergoing significant regeneration in recent years."
"This is an ideal part of town for many office-based businesses and a strong alternative to the CBD. There are many organisations which can benefit from a suburban location, especially service-oriented companies which can realise efficiency gains from being positioned close to their customers in business parks and industrial areas."
What's on offer?
The property: Industrial showroom and warehouse complex.
Location: 282-286 Church St, Penrose.
Agency: Colliers International.
Sales method: Deadline private treaty closing October 13.
Features:
• Floor area of 3758 sq m on freehold 5550 sq m corner site.
• Earns $411,861 annually.
• Two well-established tenants.
• High profile street frontage position on arterial route.
• Shortage provides potential to increase rent in future.
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