Green Gables Motel at 560 High St, Lower Hutt. Photo / Supplied
Green Gables Motel at 560 High St, Lower Hutt. Photo / Supplied
The freehold lessor's interest in Green Gables Motel, Lower Hutt, is for sale by tender.
Land and buildings at 560 High St are being offered for sale to the market with a long-term lease in place to 560 Gables Holdings Ltd, trading as Green Gables Motel, until February 2033.
AgentsMark Sherlock and Paul Cudby, of Bayleys Wellington, emphasise that it is the freehold land and buildings only that are for sale — not the business. Tenders close at 4pm on June 27.
"Green Gables Motel itself has been leased and operated by members of the same family for around 15 years, with Dominic and Jodie Richards currently at the helm," says Sherlock.
"The motel operation consistently rates highly on popular tourist websites and its location, close to Hutt Hospital and main traffic routes, future-proofs the motel clientele base."
The freehold interest is now held by an investment company which has had a change in its investment portfolio weighting, hence the sale.
"Freehold offerings such as this are keenly contested as they represent a long-term, passive investment opportunity where the incumbent tenant is driven to keep standards high to attract guests," says Sherlock.
Green Gables Motel offers 14 self-contained units including studios, one, two and three-bedroom motel units along with the four-bedroom manager's accommodation. There is ample guest parking, grounds are landscaped and there are laundry facilities and a children's play area.
The motel is part of the Host Accommodation network, which offers a loyalty rewards programme to guests.
Land and buildings are being offered for sale with a long-term lease in place. Photo / Supplied
Sherlock says while about 15 years still remains on the existing motel lease, it's likely the inherent value of the freehold property that will be of main interest to investors.
"We're talking 2108sq m of prime Hutt land; that's a pretty attractive holding. Hutt Hospital visitors make up a large part of the clientele and, given the quick road access into Wellington city and closeness public transport options, the occupancy levels are really stable."
The full net lease has two-yearly rent reviews built in and earns $208,000 per annum. The tenant's vested interest in having well-presented and well-maintained accommodation to protect their own business value, means the lessor's interest is cushioned.
Sherlock says it's not often that the freehold interest in a motel comes to the market. The two most high-profile examples in the Wellington region in recent years are the Marksman Motor Inn in Mount Cook and Capital Gateway Motor Inn in Ngauranga Gorge.
"The capital value on the land and buildings at 560 High St is $2.21 million, however, market evidence and the current state of the commercial property sector suggest that the market value is well north of that figure," says Sherlock.
