Rare Devonport properties in two packages

5:00 AM Saturday October 31, 2015 Colin Taylor

The Devonport sale includes this corner two-story heritage building at 49-51 Victoria Rd leased by Manuka Cafe.

Four neighbouring buildings in the centre of Devonport on Auckland’s North Shore are to be auctioned in two parcels early next month unless they are sold by negotiation before the auction day.

“The offering includes a two-story heritage building on the corner of Victoria Rd and Clarence St, with the popular Manuka Cafe on the ground floor,” says Deborah Dowling of Colliers International.

“It also includes single-level properties along Clarence St which are occupied by various retail tenants,” says Dowling who, with colleagues Euan Stratton and Charlies Oscroft, is marketing the buildings at 49-51 Victoria Rd and 12 & 14 Clarence St for sale by auction at 11am on November 11.

“Devonport property is traditionally very tightly held by its owners, many of whom are long-term local owners, so the chance to purchase commercial property in Devonport comes up very rarely,” Dowling says.

“There is no developable commercial land left in the village centre and existing properties come on to the market very infrequently. These properties have been owned by a family trust for around 40 years and are only on the market because the owner is moving overseas.”

One parcel comprises 49-51 Victoria Rd and 12 Clarence St and is made up of a two-story heritage building on the corner, along with four single level shops in two buildings along Clarence St.

Dowling says several tenants occupy a total of 892 sq m of floor area. “Manuka Cafe leases the entire heritage building, with part of the upper floor sub-tenanted to a financial services firm. The building was constructed in the late 1880s or early 1900s and has a Category A historical classification,” she says.

“This attractive building is one of several Victorian-era buildings along Victoria Rd which help give Devonport Village its charm and character. It has an ornate facade with well-preserved details including original timber sash windows.”

The single-level retail buildings at 12A and 12B Clarence St date back to the 1950s and are leased to Marqueez Jewellery, Sea Dragon Takeaways, Devonport Fruit & Veges and Stone Oven bakery.

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The building at 14 Clarence St, Devonport is divided into two tenancies occupied by Ike’s Emporium and Devonport Ceramics. 

Stratton says the property has good lease terms viewed as an investment asset. “All the tenants hold rights of renewal and the anchor tenant, Manuka Cafe has the potential to extend its lease until October 2030,” he says.

The second parcel going to auction comprises the 408 sq m building at 14 Clarence St which is divided into two tenancies occupied by Ike’s Emporium and Devonport Ceramics.

“The two parcels have freehold property titles and have a combined land area of 1534 sq m in the heart of one of the North Shore’s most affluent suburbs,” Oscroft says.

“All the buildings have rear access lanes and there is some parking availability behind 12 Clarence St. This is an excellent location with Victoria Rd being the main thoroughfare through Devonport Village, and Clarence Street constituting one of the principal retailing side streets.

“Close to two million passengers, including many tourists and commuters, pass through the Devonport ferry terminal every year providing a constant customer supply for cafes and retailers in the village.”

Stratton says the properties make an excellent split-risk investment and come with plans for a significant potential redevelopment project, which a new owner may wish to carry out subject to consents being applied for and granted.

“Value could be added to the property by redeveloping the single-level buildings along Clarence St into a Mixed Use property incorporating retail units and apartments over three levels - although the new owner would have to gain council consent for such a development,” he says.

“A possible design drafted for the current owner depicts a development sympathetic to the existing streetscape and complements the heritage building occupied by Manuka Cafe. It includes a covered pedestrian laneway linking Clarence St to Bartley Square and Fleet St.”

Proposed apartments on the upper levels vary from one bedroom and one bathroom units, to three bedroom and two bathroom units.  A secure underground car park is included in the plans with the apartments accessed by lifts.

Oscroft says such a development would likely add significant value to the properties. “Modern retail units and apartments are a compelling proposition for the Devonport village centre, with the lack of land available for new buildings. The opportunity for apartment residents to be able to walk to the ferry terminal and catch a ferry to the Auckland CBD for work is likely to be a highly attractive lifestyle choice for many commuters.”

Stratton says the properties already have very strong investment characteristics taken as they are, with investors’ income risk reduced through the multiple tenancies.

"Devonport has long been a sought-after suburb, with the shops and cafés in the commercial centre frequented by locals and day-trippers, making it a very popular investment location.”

Stratton says the 2013 census data shows the median personal income for adults over 15 in Devonport-Takapuna was $35,300 per annum – significantly higher than for the adult population of Auckland as a whole at $29,600. Additionally, 12.5 per cent of adults had a personal income of over $100,000 per annum in Devonport-Takapuna compared with 7.4 per cent in Auckland.  

The sale comes when a $5.5 million upgrade of neighbouring Devonport Wharf by Auckland Transport is underway. This includes a refurbishment of the wharf's entrance, a new boardwalk and an upgrade of Marine Square from a car park to an appealing gateway to Devonport.

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Deborah Dowling (left), Euan Stratton (centre), and Charlie Oscroft (right), of Colliers International.