CBD Standalone For Sale W/ Freehold Tenure Close To Viaduct

Media Release
8.4.2013

CBD Standalone For Sale With Freehold Tenure Close To The Viaduct

A freehold commercial building overlooking Auckland’s sprawling Viaduct Precinct zone has been placed on the market for sale – with potential for a large owner/occupier or converting the premises into a mixed-use address outlined in the just-released Auckland Council Unitary Plan.

The four-storied 1990s-constructed building at the bottom of Nelson Street is less than 100 metres from the strictly defined border which breaks up leasehold and freehold land in the central city.

The partly-tenanted 1187 square metre building has 33 car parks and sits on 896 square metres of land – currently generating $120,680 per annum in rental. The property is being marketed for sale through a tender process closing on April 11 run by Bayleys Real Estate trio Lisa Nielson, Steve Orr, and James Chan.

Presently, the building has holding income generated by tenants which include hospitality and retail customer services training organisation Treehouse which has a lease running through to the middle of next year, and by IT call centre company LiveOps which has a lease expiring in the latter part of this year. Currently, just 38 percent of the building is tenanted.

The ground level of the building contains car parking, a foyer entrance, service rooms, along with disabled toilet and shower amenities. Constructed from reinforced concrete with concrete columns and beam frames, the building has an Initial Evaluation Procedure (IEP) of 141 percent of the New Building Standard – resulting in an A+ rating.
“Since the earthquake in Auckland earlier this month, potential buyers of commercial property have become increasingly conscious about the earthquake performance ratings of buildings being offered for sale. With an IEP of 141per cent for 5 Nelson Street, this has gone a considerable way to allaying much of those concerns,” Mr Orr said.
The building is located within Auckland’s Victoria Quarter which has undergone considerable redevelopment over the past decade – including the substantial creation of residential blocks neighboured by purely commercial premises. The property is owned by a Wellington businessman who is divesting his Auckland portfolio after owning the building for 10 years.

Mr Orr said the building had excellent transport links – particularly with Auckland’s Southern and Western motorways. Nelson Street is the extension to the off-ramps for both highways, and sits just one block over from Hobson Street which has the on-ramp for both routes. Bus routes to the North Shore are less than 100 metres away.

With substantial traffic volumes travelling daily down Nelson Street, and a prominent mechanical plant structure on the roof overlooking Fanshawe Street, Mr Orr said the building had two excellent vantage points for owner/occupiers wanting highly-visible signage exposure or building naming rights. Alternatively, the property could have a new future.

“The Auckland Unitary Plan released this month was very specific in its call for an increase in the number and scale of mixed-use buildings in the central city - encapsulating existing commercial or retail use with the addition of residential dwellings in upper levels,” Mr Orr said.

“The premises at 5 Nelson Street is the epitome of such future developments – with the upper level offering views over the western reaches of the Viaduct Basin, with glimpses further out to the Waitemata Harbour. The appeal for this building, being freehold, is its proximity to the Viaduct Precinct which is all leasehold – with its associated additional cost of often uncontrollable ground rents.

“In its current format, the building could accommodate two superb and quite substantial apartments per floor – each with multiple car parks allocated to a specific residence.”

“Establishment of large residential blocks has already been undertaken on two sides of the building, while the varied social infrastructure of the Viaduct is just a few hundred metres away.”

Mr Orr said that subject to council approval within the current strategic management area zoning three, there was also the potential to add additional levels on top of the existing structure – either for commercial space or residential apartments.

Adjoining the western perimeter of the Nelson Street building is an Auckland City Council car park – enabling staff numbers, when fully tenanted - to be expanded considerably without the requirement to necessarily allocate additional on-site parking.

Caption: Just metres from Auckland’s leasehold zone, this freehold property up for sale has considerable rental upside when fully tenanted.

ENDS

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