A rare Newmarket development property has come onto the market after being in the same family for more than a decade.
The big freehold property at 29 Broadway, 31-33 Broadway and 4-10 Alma Street is being sold by H & L Investment Trust to rebalance its portfolio.
Nearly 2600 sq m of net lettable space is spread over 11 retail and commercial tenancies in three buildings on a 2796 sq m site opposite the Broadway roundabout. The property with three frontages has a two-level parking building with room for 63 vehicles sits in the middle of the site.
Tenants include the Persian Rug House, Toys R Fun, Bikram Yoga, a high end Japanese furniture store, Sichuan Restaurant, other retailers and commercial businesses. Fully leased, the property returns $764,000 net a year.
The property is for sale by private treaty through Colliers International. Investment sales brokers James Thorburn and Deborah Dowling say the significantly under-utilised property is an ideal redevelopment site, as it sits within the boundaries of the Auckland City Council’s proposed Newmarket Growth Structure Plan.
If the plan is adopted Newmarket’s zoning will be intensified to encourage denser retail and residential growth and public transport use.
Under the proposed new zoning the site’s height limit will automatically lift from 15 metres to 21 metres and the floor area ratio will intensify from 2:1 to 4:1. If bonuses are generated through additional features, such as extensive landscaping and thoroughfares, the floor ratio could reach 6:1. It will be possible to build up to seven storeys on the Broadway frontage.
“The proposed change of zoning makes this property an extremely valuable site,” says Thorburn.
Even without the change of zoning, the property has some immediate redevelopment potential, says Joshua Hoo, H & L Investment Trust manager. “As the property on the Broadway frontage is not built out to street level, the floor area can be increased. It is possible to also build up to the height limit of 15 metres.
Hoo’s grandfather bought the property in the early 1990s and he and his father bought it several years later for the trust. “It has been a good investment and is one of the few sites in Newmarket that doesn’t have full site coverage or one stand-alone building.”
Thorburn says a new owner has myriad options for the mixed-use zoned site, particularly as the existing leases contain demolition clause, some of which can be invoked immediately, although most don’t come in to effect until the second term of the lease.
“The property can be retained as it is for a long-term hold, partially redeveloped, totally redeveloped or land-banked. Although the site is connected, it can split into four separate incoming earning parts and redeveloped in stages.”
He says the property provides a good passive income while a new owner works on redevelopment plans, obtains resource consents and pre-commitments from tenants.
The council says development in Newmarket is important as it is second only to the CBD as a thriving area for retail and commercial businesses. It is recognised as a regional centre with depth beyond a single road of main street shopping.
Newmarket operated as a separate borough between 1885 and 1989 before it amalgamated with Auckland city. Although only 77.6 hectares in area, it has always had a strong commercial base that increased and diversified over time. For more than a decade Newmarket has been in the council’s sights as an area of growth and change.
Newmarket’s population within one kilometre of the railway station has grown 20 per cent between over the past 10 years and compared to other Auckland suburbs it has more people with a university degree, more families with a combined income of more than $100,000, and more residents of European descent.
The council says intensified zoning is needed to build on Newmarket’s position as the premier shopping precinct in Auckland, retain the character of the backstreets and historic residential areas and cluster development around public transport nodes.
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