'Rock solid' medical units just what doctor ordered for investors

The two ground-floor units for sale in Ascot Office Park are in Building A, 93 Ascot Ave, Greenlane. Photo / Supplied

Two ground-floor, freehold strata-titled units at the northern end of Ascot Office Park at 93 Ascot Ave, Greenlane, which are both occupied on a long-term lease by global dialysis giant Fresenius Medical Care (FMC), are being offered for sale as one property.

"This is a rock solid, passive investment, with guaranteed rental growth built in," says Colliers International broker Bryce Holmes, who is selling the units with colleague Peter Kermode for Riva Properties.

"What we have here is an established, international medical tenant with a proven track record in a near-new and high-quality building in a keenly sought-after medical location that has no vacancy, on a long-term lease that guarantees rental growth," Holmes says.

"These units are FMC's core operation in an ideal location. Although the company may expand, this is likely to be near hospitals in other parts of the city while retaining this cornerstone facility.

"The company specifically asked for a ground-floor location close to Ascot Hospital to allow for easy access for patients, so this opportunity would be very hard to replicate."

Holmes says Units GA1 and GA2 in Building A, next to the Ascot Hospital and the Novotel Hotel on the Greenlane roundabout, are for sale as one property by deadline private treaty, with offers due by 4pm on Wednesday August 11.

"FMC has invested in a significant medical fit-out for the specialised operation of dialysis machines and the property also comes with 10 car-parking spaces for patients and visitors," says Holmes.

Fresenius Medical Care is the world's largest integrated provider of products and services for individuals undergoing dialysis because of chronic kidney failure, a condition affecting a growing number of people worldwide.

Listed on the Frankfurt and New York stock exchanges, FMC provides dialysis treatment to 198,774 patients around the globe through a network of 2580 dialysis clinics.

The company, which has its origins in 15th century Germany, produces dialysis machines for a worldwide market and is growing internationally with the manufacture and supply of dialysis product, machines and care to this ever-increasing market.

Holmes says Colliers helped FMC grow its presence in New Zealand by working with the company last year to establish its Airport Oaks facility, which distributes medical and dialysis equipment to hospitals and facilities throughout the Auckland region. The agency also facilitated FMC's sourcing and negotiation for its premises within the Ascot precinct.

Kermode says the lease to FMC provides $150,000 a year net of outgoings and began on May 1, 2008.

"It has a seven-year term, plus two rights of renewal of seven years each, so its final expiry is 2029," Kermode says. "For investors this is an attractively long period and, as rent reviews are set yearly to CPI or 4 per cent, whichever is the greater, this represents a strong opportunity for a passive investor to become involved in a very stable situation offering an unusual level of growth at the same time."

Holmes says Ascot Office Park offers style, sophistication and the amenities of quality buildings with ample parking in parklike surroundings. It was completed in 2006/2007 and is now 100 per cent occupied.

"The development of Ascot Park next to one of the largest private, fully integrated medical, consulting and surgical facilities in New Zealand has been a great success. The offices are built to a high standard with quality materials, set in fully landscaped grounds with great street appeal.

"The office park lies at the heart of one of Auckland's core arterial road and rail links alongside the key motorway axis between north, south and west, only 150 metres from the on-ramps in both directions."