A high-profile property in one of Auckland's most affluent suburbs is for sale with long leases to a global insurance giant, a leading food distributor and a well-known gym.
Colliers International is marketing 57 Market Rd, Remuera, for sale by a deadline private treaty closing at 4pm on June 12, unless sold earlier.
Comprising a 1942sq m commercial building on a 2147sq m freehold site, the property is at the nexus of upmarket Remuera and Epsom, with train and motorway access close by. It's also within metres of Great South Rd.
Three commercial leases, together with income from a 59-space carpark, total $673,942.84 net in annual rent. The weighted average lease term is 5.7 years as of April 2019.
Colliers' Gareth Fraser sees a chance to secure a split-risk investment with outstanding tenant covenant.
"The property is anchored by AIA International, the second-largest life insurer in the world, which focuses solely on the Asia Pacific market," Fraser says.
"The other commercial leases are to multinational wholesale food distributor Bidfood and international gym operator Jetts Fitness.
"The calibre of these tenants, combined with the superb location and fundamentals, make this an outstanding investment property."
Constructed in 1997, the property has an A-plus grade seismic rating of 115 per cent of new building standards (NBS).
Broker Simon Child says both office levels have been refurbished to provide quality modern office accommodation.
"There's lift and stairwell access from the basement, while the main lobby is accessed directly from Market Rd.
The offices have a lower level of basement parking and storage."
The three commercial leases are to:
• AIA which occupies 820.8sq m on a six-year lease that includes 12 car parks and signage rights. An additional 12 car parks are on a revolving annual lease. The company pays $328,504.80 in net annual rent; with reviews on the base rent only fixed at 2.5 per cent. The main lease expires in January 2024, and there is a two-year right of renewal to January 2026.
• Bidfood occupying 519.07sq m plus 15 car parks on a six-year lease, earning $187,761.60 in net annual rent. Annual rent reviews are fixed at 2 per cent. This lease expires in June 2024, after which there are two rights of renewal of three years each.
• Jetts which occupies 306.59sq m plus eight car parks on a seven-year lease, earning $113,676.44 in net annual rent. Annual reviews are indexed to inflation plus 2 per cent, while the lease expires in September 2026, with no further rights of renewal.
Two other companies lease six car parks each on six-year terms.
These leases earn $22,000 each in net annual rent, with annual rent reviews fixed at 2.5 per cent, with no rights of renewal upon lease expiry at the end of January 2025.