Split-risk commercial investment with redevelopment potential
A fully leased commercial property for sale in Auckland’s tightly held Grey Lynn offers excellent commercial property fundamentals.
The 355sq m freehold property at 26B Williamson Ave is prominently positioned on a north-facing corner site in one of Auckland’s most desirable locations.
Colliers International city fringe sales specialists Kris Ongley, Jonathan Lynch and Hamish Paterson are marketing the property for sale by auction at 11am on Wednesday 22 August, unless it sells earlier.
Ongley says it is an outstanding chance to acquire a solid investment in a hugely popular area with keen demand for real estate of all descriptions.
“The property is superbly located on the main route between Ponsonby and Grey Lynn, only a block from the Countdown supermarket, two blocks from Ponsonby Road, and 2km from the CBD.
“It is fully leased to four tenants but future rental upside presents an opportunity for adding value.
“The versatile layout and generous Business Mixed Use zoning allow for conversion to showroom retail or potentially residential use in the future.
“In the longer term, the site’s 27m height overlay provides scope for a more intensive redevelopment, possibly with a mix of ground floor retail and upper-floor apartments.”
Constructed in the 1990s as a three-level warehouse, the property was later converted to a two-level, mixed-use commercial building plus basement.
A recent IEP assessment found the building meets 100 per cent of current seismic standards.
Lynch says the property offers a total net lettable area of 530sq m over three levels, along with parking at the front of the property for five vehicles.
“Tenants include the well-known Mickey B Fitness gym, a travel agency specialising in in-bound French travellers, an advertising billboard, and telecommunications equipment.”
Lynch says the property is well located in the high-density commercial pocket of Grey Lynn, on its border with Ponsonby.
“The surrounding activity is a mix of office, showroom retail, light industrial, hospitality and residential apartments.
“Positioned a short walk to Ponsonby Road and the CBD, this area is popular for its central location, fast-developing commercial and residential activity, access to retail and hospitality amenity, and diverse business community.”
Paterson says the freehold title lends itself well to future redevelopment.
“The site is regularly shaped, with a combined 45m of frontage to Williamson Ave to the north and Mackelvie Street to the west.
“The contour of the site slopes gently away from Williamson Ave, with main building access off Williamson Ave and vehicle and foot access to the basement from Mackelvie Street.”
The four leases currently return approximately $131,504 plus GST in net annual rent.
Mickey B Fitness occupies about 408sq m including the 214sq m ground floor showroom and warehouse, 102sq m basement and 92sq m mezzanine.
The gym is signed to a six-year lease returning $72,200 plus GST in net annual rental. Market rental reviews are every two years, with the next review on 1 September. The lease expires in August 2022, with no further rights of renewal.
Travel agency Frogs in NZ occupies the 122sq m first floor office.
The company pays $38,430 plus GST in net annual rent, with 3 per cent annual rental increases, plus market reviews on renewal. It is signed to a three-year lease, with a three-year right of renewal in July 2021.
The billboard returns $5,000 plus GST in gross annual rent, plus 40 per cent of the sign revenue received by the tenant. Multiple rights of renewal extend the final lease expiry to December 2033.
Spark’s telecommunications equipment returns $12,000 plus GST in gross annual rent, with CPI rental reviews every three years and market reviews on renewal. The current six-year lease expires in November 2021, after which there are two six-year rights of renewal.
Paterson says strong interest is expected at auction.
“With rental upside, future redevelopment potential and a sought-after location, this property makes for a savvy investment indeed.”
Get the latest commercial real estate insights and property news.
Looking for commercial real estate? Try our property search or connect with expert commercial real estate agents today.
Need your real estate assessed? Work with our expert property valuation services team.