Two early childhood education centre developments for sale in fast-growing areas south of central Auckland are being billed as affordable investments with strong fundamentals.
Colliers International early childhood sector specialist Peter Kermode and colleague Shoneet Chand are marketing the freehold investment properties in Pukekohe and Pokeno for sale by deadline private treaty.
Offers on 144 Kitchener Rd, Pukekohe, and 62 Pokeno Rd, Pokeno, close at 4pm on Wednesday, July 19, unless sold earlier.
Kermode says the purpose-built centres are being developed for Kindergarten NZ Limited, which has a solid track record of operating early learning centres in Auckland.
They are being built by Signature Homes, which has developed more than 100 early childhood centres in New Zealand. Both are due to be completed in mid-2018.
"Both properties offer very strong fundamentals at a price point affordable to family trusts and other smaller investors," Kermode says.
"They have long-term leases, excellent tenant covenant, new buildings constructed to modern building standards, and locations with huge growth potential."
Kindergarten NZ has committed to 15 year leases with two 10-year rights of renewal on both properties.
The Pukekohe property will earn $283,920 in net annual rent once completed, while the Pokeno property will earn $312,000.
Rental growth is locked in, with fixed annual increases of 2 per cent, as well as hard ratcheted market rent reviews every five years.
"This is an outstanding opportunity to acquire one or both properties, with an investment grade tenant backed by over a century of history," Kermode says.
Established in 2002, Kindergarten NZ is a subsidiary of the Auckland Kindergarten Association, a charitable trust that has been providing quality early childhood education since 1908.
"The trust is the largest kindergarten association in New Zealand, and its Kindergarten NZ subsidiary has been providing early childhood education and full day care services for 15 years," Kermode says.
"As well as its four Auckland early learning centres, Kindergarten NZ also offers advisory services in the early childhood sector."
Kermode says both new developments will comprise single-level, purpose-built early childhood education centres designed to meet current industry standards. The centres will be divided into four classrooms catering to different age groups, from babies to 5-year-olds.
Both sites will also include extensive outdoor play areas and generous onsite car parking.
Licensed for 105 children, the Pukekohe centre will be built on a 2011sq m site only 2.5km south of the main township. The property is within 100m of the intersection with the main road, Queen St. It is within 250m of Parkside School and Pukekohe Hospital.
Kermode says Pukekohe, part of the Auckland region, is well located some 50km south of the CBD. "This high-growth area is the second largest urban region in Auckland," he says.
"Auckland Council has identified Pukekohe as a priority satellite town for 50,000 people and 9000 new jobs in the next 30 years, making properties in the area a solid investment."
The Pokeno centre will be licensed for 120 children.
It will be built on a greenfield site, directly adjacent to Pokeno School, with the size of the final landholding to be determined. Kermode says Pokeno is at the intersection of State Highway 1, between Auckland and Hamilton, and SH2 to Coromandel and Bay of Plenty.
"Less than an hour from the Hamilton and Auckland CBDs, Pokeno has all the benefits of a country lifestyle without sacrificing the convenience of the nearby cities," he says.
"Pokeno is experiencing huge growth, with Waikato District Council projecting some 150ha of residential and 80ha of industrial land to be at capacity within 15 years."
Kermode says the council's plan for Pokeno includes 2000 residential sections to the north, a revitalised town centre, and sports park.
"Almost 900 residential lots have sold already and demand is very high, which bodes well for childcare investments in the area," he says.
Both properties are featured in the latest Colliers Portfolio.