Sport teams’ favoured motel comes into play

11:17 AM Saturday September 20, 2014 Colin Taylor

Entrance to Howick Motor Lodge which is for sale 682 Pakuranga Rd, Howick.

The land, buildings and business comprising the Howick Motor Lodge in Auckland’s eastern suburbs have been placed on the market for sale by auction on October 22 through Bayleys Auckland.

Bayleys salesperson Shiona Dyer says the freehold property has10 units running at an occupancy rate of 70 per cent.

“The make up of guests is spread across business travelers and a strong contingency of sports teams playing in competitions at the nearby Lloyd Elsmore Park which has soccer, cricket, hockey and rugby pitches,” Dyer says.

The motel’s room configuration is split between six split-level family units with upstairs and downstairs accommodation sleeping up to six guests, and four studio units sleeping up to three guests. Rack rates range from $130 per night for a studio unit and $150 per night for a family unit.

The motel is zoned as mixed housing suburban under the Proposed Auckland Unitary Plan, but Dyer says the quality of the property meant it would most likely continue operating as a motel.

She says the complex, which sits on 1677 square metres of land, could function as a business run by an owner operator or was big enough to sustain an on-site manager.

“We’ve had the property assessed by industry professionals as to future use potential, and the feedback is that its value lies in operating as a commercial accommodation provider rather than strata titling the individual units into separate dwellings, or constructing medium density homes.”

Dyer says the business includes a four-bedroom owner’s residence, with a front office reception area.

Each of the units comes with their own outdoor courtyard or balcony, full-size stove and microwave in the kitchen, and SKY TV connection. The motel has a free-standing swimming pool with adjoining bbq area, laundry, and has been successfully trading for nine years.

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A guest unit within the Howick Motor Lodge.

In addition to being close to Lloyd Elsmore Park, the Howick Motor Lodge also benefits from its prominent profile on the Pakuranga Highway which links Howick to both the north south running State Highway One and Auckland CBD. The motel is also used by corporate guests while working short-term at the nearby Highbrook Business Centre.

“The domestic, sports based clientele repeat booking at the Howick Motor Lodge has remained relatively steady over the past six or seven years, and unlike the corporate sector, was never really affected by the global financial crisis,” Dyer says.

“Most of the sportsrelated repeat bookings are from teams playing in annual tournaments, where they tend to come back year after year – booking up to 10 months in advance to secure their accommodation for the following year.

“That sort of long-term business continuity has allowed the Howick Motor Lodge’s operators to accrue a planned budget for regular property maintenance and interior décor and fitting refurbishment – enabling the business to command premium pricing levels.

“That constant refurbishment programme has meant the business has successfully avoided the common trap of many motels in becoming tired and run-down, leading to a consequent drop in revenues, in what becomes a downward spiral.”

Dyer says potential buyers would consequently be able to take confidence that minimal refurbishment was required at the Howick Motor Lodge in the short to medium-term, allowing new operators to concentrate on familiarising themselves with the business and its clientele for the first year of trading.

“The lodge’s current owners are willing to discuss a potential hand-over period with any potential buyers if required or sell the business with a fixed possession date in mind,” Dyer says.

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