For the first time in 20 years, a waterfront office and hospitality asset in the heart of Auckland's downtown entertainment precinct is for sale.
In the centre of Viaduct Harbour, and 100 per cent occupied by some of the most recognised food and beverage operators in the city, 204 Quay St will be marketed by CBRE agents Jonathan Ogg and Warren Hutt.
The property will be offered for sale by international deadline private treaty closing on October 22 at 4pm.
Hutt says 204 Quay St is in a true gateway location. "Not only is it highly prominent, well known and visited on its own, but it is set to gain from over $1 billion in surrounding waterfront investments by public and private sectors as Auckland approaches the America's Cup in 2021," he said.
"The purchaser of this property will benefit immediately from established tenants and a long WALT (weighted average lease term) providing a secure long-term income stream. "They will also be exceptionally placed to take advantage of Auckland's increasing focus on the waterfront, through and beyond the America's Cup."
The four-level commercial building at 204 Quay St offers high quality hospitality and office space on a 2744sq m perpetually renewable leasehold site. The main buildings were built in the 1940s and have been extensively refurbished over recent years. Today they offer a net lettable area of about 5474sq m. The property is 100 per cent leased, with a long WALT of 7.8 years, and provides net passing income of $1,512,325 per annum plus GST.
Tenants on the ground level are Holey Moley, Danny Doolan's, and Degree Bar & Restaurant, all of which have invested significantly in fitouts in recent years. Degree Bar has just completed a full makeover.
One level above are Dr Rudi's, Saint Alice and Parasol & Swing hospitality venues, and on Level 3 are offices occupied by engineering and infrastructure company Downer Group, alongside one of New Zealand's largest commercial and residential masterplan developers, McConnell Property. Said CBRE's Ogg: "204 Quay St's food and beverage tenants are widely regarded as some of the best, offering the busiest dining and nightlife entertainment within Auckland.
"Large and efficient floor plates, ample natural light and terrace views of the Viaduct Harbour are key factors in attracting and retaining tenants in these eateries, and fixed annual rent reviews will provide strong income growth for the purchaser."
Hutt says the property is surrounded by major infrastructure and commercial developments and a growing resident and working population.
"The Viaduct is adjacent to the city's main commercial and retail hubs. Not only is it peppered with popular bars and restaurants, with views of the Waitemata Harbour, it is well connected with direct access to the Britomart train station, ferry terminal and public transport linkages.
"We can confidently say that 204 Quay St is in Auckland's most desirable dining and entertainment precinct, often the first choice destination for locals and tourists alike."
Auckland Council and the Government have committed $212m to upgrade the waterfront ahead of the 2021 America's Cup, part of a series of investments into infrastructure and commercial projects totalling more than $1 billion.
The Viaduct Harbour will become the base for Team New Zealand and home to all syndicates for the regatta, and 204 Quay St will be at the forefront with the opportunity to showcase the city, harbour and its innovative sectors on a global stage.
With more than $28 billion of construction projects underway, Auckland is in the midst of heavy infrastructure investment, including the $700m New Zealand International Convention Centre, America's Cup Village and the $3.4 billion City Rail Link.
Said Ogg: "These developments will be the most transformational project Auckland has ever seen, in turn making the city's waterfront a stronger economic force and more attractive to residents and visitors."
Statistics show international visitor arrivals into Auckland have increased by more than 840,000 over the past five years, with annual average growth of 7.6 per cent.
Moreover, by 2021 the inner-city's residential population alone is projected to reach 70,000, and Wynyard Quarter will have a 5000 residents. This growth is set to drive demand for food and beverage operators in this precinct, said Ogg. "Investors are showing a preference to expand food and beverage offerings, using innovative food concepts to attract foot traffic and take advantage of the higher rents on offer, making it one of the best uses of available space."