The property at 42 Atkinson Ave, Otahuhu, South Auckland, is home to the Pacific Advance Secondary School (PASS), a charter learning institution whose student roll is made up of some 134 Samoan, Tongan, Niuean, Rarotongan, Maori, and Fijian students.
The school delivers educational programmes and lessons to students in years 9 to 13 under licence to the Ministry of Education.
Sitting on some 2633sq m of business mixed-use zoned land, the freehold property features a two-storey 1581sq m commercial building divided into classrooms, performance studios, and staff amenity spaces. The school also has its own dining hall, with food prepared in a kitchen on site.
Built in the 1980s, the premises consists of 743sq m of commercial space on the ground floor, and 803sq m on the first floor.
The school is on a 12-year lease assigned to the Crown through to 2026 with a further 12-year right of renewal, generating an annual net return of $310,587 plus GST. Rental reviews are undertaken every three years.
The Atkinson Ave property is being marketed for sale by deadline private treaty through Bayleys Auckland, closing on October 17.
Bayleys salespeople Ben Bayley and James Hill said the L-shaped building was serviced by a sealed car park at the rear, with room for some 42 vehicles, including seven under cover and five within a garage.
"Improvements to the premises, which includes the fit-out of classrooms and the commercial kitchen facility, have been undertaken at a cost of $338,225," said Bayley.
"These features will see the tenant pay the landlord an improvements rent of $62,447 per annum commencing January 2019, with the final payment scheduled for October 2026.
"The capitalised works rent will be payable in the same manner as premises rent and will be revised in the rent review dates at the same percentage increase as the premises rent.
"For any new owner of 42 Atkinson Ave, the tenancy by the Pacific Advance Secondary School ensures a substantial holding income is derived over the medium to long term while potential redevelopment options are explored."
Auckland Council's business mixed-use zoning allows for developments which soften the demarcation line between commercial and residential areas. Subject to consents, buildings up to four storeys and a maximum hight of 18m can be built.
"This would allow for the construction of a more intensified commercial entity on the site, with the potential for the lower level to sustain covered car parking facility," said Bayley.
Hill said neighbouring properties around the school included light industrial operations in the automotive sector as well as multiple small retail premises, encompassing convenience and fast food outlets, and neighbourhood community stores.
"Atkinson Ave is a virtual demarcation line between the residential portion of Otahuhu to the east, and the light industrial and business activities taking place to the west," Hill said.
"The property is less than 9km to Manukau, less than 20 minutes to Auckland's CBD, and within minutes of the southern motorway, Otahuhu train station and other major arterials," Hill added.