Split-risk investment in high-growth Auckland location
An established medical centre for sale in flourishing Warkworth offers a chance to acquire a fully tenanted, split-risk investment property in one of Auckland’s fastest-growing centres.
Colliers International has been exclusively appointed to market 4 Warkworth Street for sale by deadline private treaty closing at 4pm on Thursday, 26 October, unless sold prior.
The property is featured in the latest nationwide Colliers Portfolio.
Broker Sean Honeycombe, who is marketing the property with colleagues Shoneet Chand and Jonathan Lynch, says its eight tenancies are currently returning a net rental income of $267,608 a year plus GST.
“This is a superb opportunity to acquire an established medical centre investment in one of Auckland’s most up-and-coming locations,” he says.
“Known as Kowhai House, the property benefits from more than two decades of continuous occupation by a radiologist, doctors’ surgery and physiotherapist.
“The strong tenancy mix is rounded out by a chiropractic clinic, acupuncturist, massage clinic and two commercial tenancies.”
Honeycombe says the 1,761sq m freehold property comprises two buildings with a net lettable area of 1,170sq m.
The larger building features two levels fronting Warkworth Street to the north, and two levels fronting a car park to the south. A standalone single-storey building is also accessed from the car park.
Honeycombe says the property’s central location puts it close to all of Warkworth’s key amenities.
“Kowhai House is smartly located in the block between Neville Street, which is Warkworth’s main retail strip, and Percy Street, which is home to the New World supermarket and central car park.
“The Warkworth Library, RSA, NZ Post, pharmacies and banks are all within walking distance.”
The property offers ample parking on Warkworth Street and in the car park to the rear, which is entered via Alnwick Street and exited via Percy Street.
Honeycombe says the area has attracted increased commercial development activity in recent years.
“Kowhai House is only a stone’s throw from the historic BNZ Building, which was fully refurbished and redeveloped last year.
“Also nearby is a large-scale mixed use development that will include a retirement village and new retail units fronting Neville Street.”
Chand says Warkworth, located only 45 minutes from downtown Auckland, is undergoing a transformation from a weekend holiday destination to a fast-growing satellite centre.
“Warkworth has grown rapidly in recent years, with its population increasing 15.7 per cent between the 2001-2006 censuses, and a further 19.5 per cent between the 2006-2013 censuses.
“The wider area is also growing apace, with northern Rodney’s population of 60,000 projected to increase by a further 20,000 people in the next 20 years.”
Auckland Council’s Development Strategy identifies Warkworth as one of two major satellite centres and a key residential growth area.
“The area has traditionally been typified by lifestyle blocks, retirement housing and holiday homes, but increasing numbers of families and professionals are now starting to make Warkworth home,” Chand says.
The area’s rapid growth is being fuelled by the attractiveness of its coastline, its lifestyle opportunities and its location close to central Auckland, he says.
“It is ideally positioned to benefit from the large numbers of weekend and holiday visitors to nearby Omaha, Matakana and Snells Beach, as well as being the main service centre for a large residential catchment.”
Chand says the government is investing heavily in improving local road infrastructure.
The New Zealand Transport Agency plans to extend the northern motorway, which currently ends at the Johnstone Tunnels south of Puhoi.
“The project, which is set for completion in 2021, will mean residents in Warkworth can simply get onto the motorway and drive straight through to the city.”
Lynch says the property has a good seismic rating of 75 per cent IEP.
It is zoned Business Town Centre under the Auckland Unitary Plan, which provides for a wide range of activities including commercial, leisure, residential, tourist, cultural, community and civic services.
“A range of possible building heights can be developed, depending on the context, with provisions typically enabling buildings of between four and eight storeys.”
Lynch says the three anchor medical tenants, which have all operated from the building since 1995, account for almost 60 per cent of its rental income.
The largest, Kowhai Surgery, occupies a 289sq m tenancy.
“Kowhai Surgery is well-established family and general practice medical centre with a strong reputation for high-quality, friendly and affordable healthcare services,” Lynch says.
“Kowhai Physio, which occupies a 176sq m tenancy, offers a comprehensive range of physiotherapy and rehabilitation services, including treatment for sports and occupational injuries.
“Hibiscus Radiology, which provides diagnostic radiology services including X-rays and ultrasounds, occupies 142sq m.”
Lynch says the remaining tenancies range in size from 31sq m to 232sq m. They are leased to RMA Financial, Acorn Chiropractic, Kansa Body Balance, Warkworth Acupuncture and retailer Gold Coin.
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