Onehunga split-risk with development upside

3:49 PM Friday February 8, 2019 True Commercial

The refurbished property, at 19-23 Hill St is indicated by a blue border. Photo / Supplied

A mixed-use Onehunga property with a high-stud warehouse, substantial yard and standalone office is for sale by auction, presenting a chance to acquire a freehold investment property with future development upside in one of Auckland’s fastest-changing suburbs.

The recently refurbished property at 19-23 Hill St is fully tenanted, with two new leases offering investors a split-risk income of $296,000 plus GST in net annual rent.

Low site coverage, holding income and generous Business Mixed Use zoning provide scope for developers to unlock the future potential of the site.

The property is being presented to the market by Colliers International industrial specialists Hamish West and Ben Herlihy, and Onehunga specialists Gawan Bakshi and Ned Gow.

It will go to auction at 11am on March 6 unless it sells earlier.

West says the property provides multiple options for both investors and developers.

“Whether looking for an immaculately presented passive investment property; or a longer-term, value-add opportunity, this well-positioned property makes for a savvy buy.

“It’s in the sought-after and established central industrial precinct of Onehunga.

“A new owner can either make the most of strong tenant demand for quality industrial space in this tightly held area, or reposition and transform the property in line with Onehunga’s urban renewal.”

The site comprises a 4312sq m landholding of regular shape spanning two freehold titles.

Improvements include two standalone buildings on separate tenancies with a combined net lettable area of 1006sq m.

Both buildings underwent full refurbishment and asbestos removal in 2018.

The larger building, situated on the southern boundary, is a 750sq m warehouse with a 167sq m office and reception area at the front of the building.

Access to the high stud warehouse is via a single roller door fronting Hill St.

The smaller building, on the northern boundary, is an 89sq m house converted for office use. It includes three partitioned rooms with newly installed carpeting and security wiring.

The 3135sq m yard is accessed via two driveways down either side of the warehouse, giving drive-around yard access. A third driveway provides parking for the office conversion.

Used vehicle company 0800 Best Deals Limited occupies the warehouse, associated office, and yard, which it uses for vehicle storage.

The tenant is signed to a three-year lease earning $260,000 plus GST in net annual rent. A three-year right of renewal extends the final lease expiry to July 2024.

The lease contains fixed annual rent increases of 2.5 per cent, plus a market rent review on renewal.

The standalone office is tenanted on a commercial lease to A&R Partner Services Limited.

The company is signed to a two-year lease earning $36,000 plus GST in net annual rent, with fixed annual rent increases of 2.5 per cent.

A two-year right of renewal extends the final lease expiry to October 2022.

Bakshi says Onehunga has long been considered an industry powerhouse and is one of the most established and central suburbs in Auckland.