Mixed-use New Plymouth property offers reliable cash flow

119-123 Devon Street East and Gill Street in New Plymouth. Photo / Supplied

An opportunity to invest in a profitable four-level including basement commercial building in the heart of New Plymouth has arisen in the market.

Devon Street Property Limited, who manage the property and will continue to do so, is selling a 50 percent stake which will provide access to an impressive yield of 8.5%.

The property at 119-123 Devon Street East and Gill Street sits on a 2,700sqm Business A-zoned that provides around 3,688sqm of retail space and 1,012sqm of office accommodation, amounting to a total net lettable area of 4,700sqm.

JLL Commercial Sales Broker Kevin Reardon says the property presents a rare opportunity to buy into a reliable cash flow.

"The property provides a weighted average lease term of close to six years by income. Major tenants include an Events Cinema situated over levels one and two, along with an approximate 750sqm of office tenancy leased to Powerco," says Reardon.

"As the anchor tenant, international company Events Hospitality and Entertainment (EHE) currently leases approximately 2,400sqm and has done so for the past 17 years. Having signed a new lease at the end of 2018, EHE's current term doesn't expire until 2028, with two further rights of renewal of five years each."

In terms of location, 119-123 Devon Street East is located in the CBD of New Plymouth, and is bound by Devon Street East to the south and Gill Street to the north with dual street frontage.

To the west, Devon Street East continues on to South Road, which is a main arterial route providing access from the New Plymouth city centre to West Coast settlements, before joining back up with State Highway 3 south to Whanganui or north to Hamilton.

The immediate area provides primarily commercial and light industrial uses, with residential housing located further afield. The local residential environment provides an established market catchment with potential for further intensification to the east and south, with New Plymouth maintaining a healthy permanent population.

And it's not just the location, as JLL Commercial Sales Broker John Binning says the property has strong bones, further adding to its appeal.

"With an 'A-grade' NBS rating, buyers can be confident that the property is future-proofed," says Binning.

"Furthermore, the property has recently undergone an extensive circa $2 million investment with refurbishments including the level two foyer, bathrooms, and construction of two new cinema auditoriums with the latest technologies and provision for a function area."

The property is located within Business A zoning, which encompasses those located centrally within the New Plymouth, Waitara, and Inglewood retail areas. These are pedestrian orientated with premises located up to the street, and generally provide no parking on the site.

Most tend to be two story buildings with verandas and retail display windows. Advertising signs provide vitality to these areas and are an important and accepted component of these central business and commerce areas.

The property is being sold via an Expressions of Interest campaign, closing 4 pm 20th November 2019 (unless sold prior). All offers shall be submitted on the Expressions of Interest form or Sale and Purchase Agreement, available through the representing agents.