A two-level character building in the heart of High Street retail strip in Auckland's CBD offers multiple options for a new owner.
Located on a 240sq m freehold site opposite Freyberg Place, the 434sq m building at 41 High St is for sale semi-vacant through Cameron Melhuish, Mike Adams and Simon Davies of Bayleys Auckland. They are selling it via tenders closing at 4pm June 22, unless the property sells earlier by negotiation.
The ground floor was previously occupied by a Marcs fashion store but became vacant following the closure of all Marcs stores in New Zealand after its parent company went into voluntary administration earlier this year.
The upstairs floor, accessed via stairs off High St, is leased to a tanning clinic with a final expiry in March 2018 and is producing net annual rental income of $61,219.
Adams says the vendor's decision to offer the property for sale partially occupied with only a short-term lease in place on the upper level, presents a variety of prospective purchasers with many opportunities.
"An add-value investor could take advantage of strong tenant demand for premises in this location to secure an attractive yield," says Adams. "The building has a wide road frontage of 11.8m providing excellent exposure to busy High St. While up until recently it has been occupied by a single retailer, its width provides the opportunity to subdivide into two smaller retail tenancies. With the upstairs space, the new owner has the option of possibly negotiating a new longer-term lease with the existing tenant or securing a new occupant.
"An owner-occupier buyer could occupy the whole building or just one floor and lease the other to help defray any borrowing costs on the property's purchase. This could work particularly well for a business occupying the top floor because the ground floor would command a rental premium because of its high-profile location in a sought-after retail strip."
Adams says the property is also an attractive proposition for developers because it has the potential to add to an under-developed site with a wide range of uses permitted by its Business - City Centre zoning. "This permits a number of options. There are significantly higher buildings adjoining the property and the zoning opens up the possibility of adding more commercial space or residential dwellings on top of the existing building. However, interested parties would need to seek professional advice on this. Any resource consent would require detail on how a development will impact on neighbouring sites, places of amenity such as Freyberg Square and volcanic view shafts."
The building was originally constructed in the early 1900s. Renovation works, which included structural strengthening, were completed in 2001 and resulted in the building achieving a Grade-A seismic rating.
Melhuish says the ground floor features attractive high stud retail and showroom space while the upper level would suit a variety of commercial uses, including character office space or possibly residential conversion.
He says the property is strategically positioned between Durham and Vulcan Lanes and directly opposite Freyberg Place, in the heart of one of the CBD's most popular fashion and hospitality precincts.
"The property has massive exposure to pedestrians with over 4000 people passing the store on an average day," says Melhuish. "The established shopping precinct is a hub for top New Zealand designer labels, major male fashion brands, streetwear retailers as well as accessory shops ranging from shoes at Mi Piaci to high-end opticals at Mortimer Hurst. Adding to the location's appeal is a quirky cafe and bar scene in and around High St."
Melhuish says the area will benefit from the current major upgrade to Freyberg Place which is the main thoroughfare between High Street and the Chancery complex. This will be renamed Freyberg Square and incorporate more seating options, new paving and native trees. It is part of a $10.7m project which will also encompass the refurbishment of nearby Pioneer Women's and Ellen Melville Hall.
"The project's objectives include supporting the development of High St and the nearby Queen St Valley area as a destination where people live, work and play; and to provide a catalyst for investment in the area," says Melhuish.