Character on Vulcan Lane

7:00 PM Friday August 9, 2019 True Commercial

12 Vulcan Lane, Auckland, is a heritage listed building. Photo / Supplied

Auckland’s iconic Queen’s Ferry Hotel is on the market, presenting a rare opportunity to acquire a fully leased, freehold character property in the heart of the CBD.
The heritage-listed building is on Vulcan Lane, a  pedestrian thoroughfare just off Queen St.  
Its tenant is on a bank-guaranteed lease returning a net annual rental of $209,855 plus GST and outgoings.
Colliers International has been  appointed to sell  12 Vulcan Lane, Auckland,  by deadline private treaty closing on Thursday, August 22, unless sold earlier.
Kris Ongley, associate director of Colliers International’s investment sales team, says it is  a much-admired building in a tightly held location.
“This  heritage-listed property has been registered as Category 1 under the Historic Places Act in recognition of its aesthetic, architectural and social significance.
“Built in the 1850s, its ornate façade and other decorative details make it a rare surviving example of a Victorian-era ‘row’ public house in central Auckland.
“Its social importance is tied to the property’s history as one of Auckland’s longest-running licensed premises.
“It is still operated as a pub by longstanding hospitality operator The Social Club Limited, which leases the entire three-level building plus basement. 
“With a new first-floor venue having recently opened, the tenant has demonstrated significant goodwill ahead of its next 10-year lease renewal in September 2020.”
Ongley says rental growth is built into the lease, with the next review to CPI due in September. A further review, to the higher of CPI or market, is due to take place on renewal.
Peter Herdson, national director of capital markets at Colliers International, says the property represents a boutique investment proposition. 
“Relative to other Auckland CBD assets, 12 Vulcan Lane represents affordable value. You’d be hard-pressed to find another character building  in such a prized location.” 
Herdson says Vulcan Lane is at the epicentre of Auckland’s retail, hospitality and commercial activity. “It is hugely popular with tourists, who are attracted to its charming Victorian-era streetscape, and with CBD residents and workers, who flock to its hospitality offerings.
“Vulcan Lane forms a pedestrian link between Auckland’s  Queen St and O’Connell St, at the heart of the legal precinct.
“It is well positioned between Shortland St and Durham Lane East, making it a key thoroughfare between the Queen and High Street retail strips.”
Auckland CBD specialist Adam White, of Colliers International’s investment sales team, says the ground floor is a licensed bar trading as the Queen’s Ferry Hotel.
“On the first floor, the tenant has spent a significant amount of money fitting out a new licensed venue, John & Maise Cocktail Bar,  now open to the public.
“The top floor is used as a management office and storage, while the basement is used as a cellar. Access to all floors is via a stairwell on the front-eastern corner of the building.”
White says service access to the back of the building is by way of a narrow lane that extends from the rear behind the neighbouring properties to the west. It is entered via a lockable pedestrian doorway between 4 and 6 Vulcan Lane.
White says the opportunity to buy a fully-leased freehold building in Vulcan Lane  may not arise again for some time.