A food processing, retail and workshop property is for sale in Napier's mixed-used seaside suburb of Ahuriri.
Bayleys' Napier salespeople Sam MacDonald and Mark Evans are marketing 7 Tangaroa St for sale by private treaty closing at 4pm on Thursday August 15.
The property, which is featured in Bayleys' latest Total Property portfolio magazine, earns passing net annual income of about $89,900 plus GST from the retail, workshop and food processing premises.
A large office and warehouse of about 778sq m will be vacant when the property, on a 3768sq m site, is sold.
MacDonald says the property's sale coincides with plans being unveiled for a proposed European-inspired village development next door on the old Ahuriri Bowling Club site.
He the marketing of the freehold Tangaroa St property represents a seldom-offered opportunity to gain a secure holding in the popular seaside suburb – just 1km from Napier Port and next door to the major new planned mixed used development.
"Once that's underway and selling, it could well be a trigger for other developments in the area, including this site if the new owner wishes to exercise the demolition clause in the lease - requiring giving the food processing tenant a minimum of one year's notice to vacate.
The 1650sq m floor area of two adjoining workshop and warehouse buildings was constructed in two stages. The western structure was erected about 1980, with the more recent building built about 1995 by the present owner, who in 2009 established a fish processing facility at the rear of the buildings for his own business; until it was leased to a pet meat processing company.
A retail shop was added at the front part of the eastern building. Four years ago, most of the western building was renovated and altered for office space.
The only fixed term lease is to pet meat company Ezymeats, which has an initial five-year term that started in May over a 332sq m processing area, a 28sq m portacom and a concrete area of 480sq m. Ezymeats has three five-year rights of renewal and pays yearly rent of $50,000 plus GST adjusted every year to the Consumer Price Index (CPI). The lease also includes rent reviews every three years to market rates and the demolition clause.
Tangaroa Seafoods leases the 115sq m retail shop, 27sq m canopy and 244sq m yard on a periodic lease at $300 rent a week. The 787sq m workshop and yard will be on a 12 month leaseback to Barron Fishing, the property owner's business, at a year's rent of $32,315 when a sale is settled. The rest of the property will be vacant.
Under the Napier District Plan, the property is zoned Mixed Use allowing for a diverse mix of industrial, commercial and residential uses.
Evans says the property has "massive" development potential. "A new owner has the benefit of a holding income with opportunities to rent the vacant part of the building; and make plans for future redevelopment once the proposed Laneways Ahuriri development next door takes off."
Ahuriri is one of the oldest parts of Napier and is influenced by the port and industrial activities which surround it.
MacDonald says it is a high demand area and parts of it are landlocked between the sea and Napier Hill leaving few pockets for development, although in recent years there have been good quality commercial and residential projects in the suburb.
Recent nearby developments include Bayleys new ground floor office with five apartments above on the corner of Coronation and Bridge Sts and a tech hub established two years ago on Hyderabad Rd in a refurbished wool store building.
The next door Laneways development, the first of its kind in Hawke's Bay, is being led by Auckland development team Vinegar Lane which expects to have resource consent by December this year and the titles for the stage one properties in July next year.
Laneways Ahuriri will be based on the traditional mews model of terraced homes and will feature multi-level buildings, each designed and developed by the individual owner.
Retail shops or office spaces will open on to a European-inspired cobblestone laneway at ground level and townhouses or apartments on the floors above.
The development will also feature a central landscaped courtyard, open to both residents and the public, and designed to recreate a village atmosphere.