Newly built retail investment with upside in prominent location
A newly built Farmers department store in the heart of central Whanganui is for sale with a long-term 25-year lease.
Colliers International directors Blair Peterken, Gareth Fraser and Phil Nevill have been exclusively appointed to market the property at 85-97 Victoria Avenue and 74-96 Saint Hill Street for sale by deadline private treaty.
Offers close at 4pm on Wednesday, 15 November, unless sold prior.
Peterken says the 7,530sq m freehold property has three frontages, with excellent exposure to the main Whanganui retail strip of Victoria Avenue.
“Newly constructed in 2015, the standalone Farmers department store spans some 5,660.5sq m over two levels,” he says.
“A popular Stevens kitchen and homewares store is located within Farmers, while the remainder of the property comprises 1,170sq m of additional retail space.
“A generous 71-space public car park is on site, in addition to the ample metred street parking in the area.”
Peterken says along with the strong tenant covenant, the property offers a solid passing income of $1,123,544 per annum plus GST.
“The lease to anchor tenant Farmers has 22 years remaining, with the potential for rental growth from the first annual review in 2020,” he says.
“The property also boasts a new 12-year lease to Whanganui’s oldest eatery, the 62-year-old Cactus Creme Cafe, which reopened this month in a 185sq m unit fronting Victoria Avenue.
“An additional 985sq m of vacant retail space is available for lease, offering future upside.”
Fully leased, the property is projected to return an estimated $1,457,798 per annum plus GST.
Peterken says the long-term lease makes this a low-risk growth investment.
“The lease offers everything you’d want in an investment – great tenant covenant, scope for rental growth and long-term security of occupation. It truly is a solid long-term play.”
Fraser says Farmers backs on to the northern side of Saint Hill Street – a popular vehicular bypass of Victoria Avenue, which it runs parallel to.
The site offers some 50m of frontage to Victoria Avenue, 67m to Maria Place and 96m to Saint Hill Street.
“Located in the block between Maria Place and Ridgeway Street, the property is well positioned between the Cooks Gardens sporting stadium and Whanganui’s main retail strip,” Fraser says.
“Nearby retailers include The Warehouse, Rebel Sports, Countdown, Whitcoulls, Hallensteins, Cotton On and Stirling Sports.”
Nevill says the building is seismically sound, having been constructed to 100 per cent of the new building standards.
“The structural walls are of pre-cast concrete or masonry, with structural frames of either reinforced concrete or steel,” he says.
“On the exterior, the building is finished with a variety of claddings, curtain wall glazing, automatic glass doors, and a coloursteel G2 roof.
“Inside, the building features gib-lined painted walls, 3.3m-high suspended tile ceilings, and T5 lamps.”
Nevill says anchor tenant Farmers has been a Kiwi institution for more than a century.
“First established in 1909 as Laidlaw Leeds, in Auckland’s Fort Street, Farmers has since expanded to become New Zealand’s most established department store, with more than 50 stores nationwide,” he says.
“The Farmers Trading Company is now part of the New Zealand-owned James Pascoe Group, which operates some of the country’s best-known retailers including Pascoes, Stewart Dawsons, Stevens and Whitcoulls.”
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