This block of shops is on the market for the first time in 40 years
A suburban neighbourhood retail block comprising 10 tenancies on a 2266sq m corner site at 14-18 Raines Ave, in the North Shore suburb of Forrest Hill, is being offered for sale for the first time in over 40 years.
Marketed by Shoneet Chand and Euan Stratton of Colliers International, the properties – spread across three freehold titles – will be auctioned as one parcel at 11am on September 27 at 151 Queen St, Auckland.
The vendor, an overseas family trust, is cashing up, Chand says. “Neighbourhood retail investments like this are always very popular among buyers, and don’t come up for sale very often. The overseas vendor is cashing up their final New Zealand interest and is very motivated see the property sold on auction day.”
The 10 retail tenancies – occupied by a liquor outlet and a dairy as the two major tenants; along with an education and music tutor, cupcake and coffee shop, bakery, hairdresser, charity shop, Korean bakery, sushi shop and fish and chip shop – currently return $162,354 net a year. The offering also features significant surplus development land behind the shops.
“This is a rare opportunity to purchase an entire suburban shopping block that is fully let to established tenants that has not been on the market for over 40 years. It will provide a secure cash flow and significant rental growth for many years to come,” says Chand.
The 751sq m building is constructed using a mixture of concrete block and fibre cement cladding with a long run iron roof. It is in excellent condition and has been very well maintained by the vendor, Chand says. There is also ample parking available on the street as well as behind the shops.
The properties are zoned Business 1, which is favourable for future development, he says. The zone is designed to provide opportunities for business activities in local neighbourhood centres at an appropriate scale and level of amenity for the residential areas in which they are located. “The zone does not have intensive car parking requirements as is the case for some other zones.”
Chand and Stratton expect the property to appeal to investors from the wider Auckland region and around the country who are looking for affordable, established investment offerings with diversified income streams and future development potential.
The potential to add further value also exists, with the possibility to develop the vacant land. This means the properties will also appeal to add-value investors and developers, Stratton says.
“One possible development opportunity, provided the appropriate consents are applied for and granted, would be to build townhouses or further retail on the extra land – given the property’s handy location to schools such as Westlake Boys, Westlake Girls, Rosmini College and Carmel College.”
These schools are all decile nine, reflecting the affluence of the surrounding suburbs, says Stratton.
The tenants have signed leases with expiries spread between December 2012 and May 2022. The large established residential catchment and high-profile corner location of the shops mean they will always be popular to a large range of retail activities, Stratton says.
“This is a very stable market for neighbourhood convenience retail, with a large captive residential area surrounding the properties. In addition, the affordable rentals mean the shops are attractive to tenants.”
Stratton says the properties are located in a high profile area and are very well-known to the local community.
“It’s a very successful and proven neighbourhood retail complex, in a convenient location with a complementary mix of tenancies which services the surrounding residential area well.”
Forrest Hill is a popular and well located suburb with an established residential catchment situated on the eastern side of the Northern Motorway, accessed from the Tristram Ave interchange. “It is a sought after suburb owing to its close proximity to the motorway and the East Coast Bays beaches,” says Chand.
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