A freehold standalone property which will be positioned opposite the entranceway to the City Rail Link’s Karangahape Station is up for sale partially leased.
The offering, featured in Bayleys’ latest Total Property portfolio, comprises a two-level of commercial building of approximately 950 sq m located on 460 sq m of land at 16-18 Beresford Square.
Currently generating rental income of $107,250 plus GST, the property is for sale by tender, closing 4pm, September 17, unless sold prior. It is being marketed by Alan Haydock, director of Bayleys Auckland & City Fringe division, and senior broker Damien Bullick.
“This is a big opportunity for an owner occupier, investor or developer to secure an unbeatable position in a key central city growth area,” says Haydock. “The property offers considerable add value opportunities both in the short and medium to long term.
“There is an immediate opportunity to significantly increase the building’s income by leasing the vacant ground floor which has recently been refurbished and provides 406 sq m of character accommodation with concrete and timber flooring and exposed building services. Previously occupied by a graphic design company, it benefits from approximately 20 metres of road frontage to Beresford Square and would be suitable for office, retail or showroom use.
“Alternatively, a business could take advantage of current historically low borrowing costs to buy the building, occupy the ground floor and use the income from the upstairs tenancy to pay the mortgage.
“Longer term, the land’s City Centre zoning and its pivotal position just metres away from the CRL station entrance provides massive commercial and/or residential development potential,” Haydock says.
Damien Bullick says the building was constructed in the 1960s and the upper level has approximately 537 sq m of lettable space, including a mezzanine, accessed by either of two stairwells at the front of the property. It benefits from plenty of natural light with floor to ceiling glazing on its frontage and skylights in the roof.
The Centurian Sauna has been in occupation on this floor since 2003 and is currently on a four-year lease from September 2018, with the next two-yearly market rent review scheduled for September next year.
The tenant has one further four-year right of renewal but the lease can be terminated for redevelopment purposes with 24 months’ notice from September 2022 if the lease is renewed. Bullick says this could coincide with the scheduled 2024 completion of the CRL’s Karangahape station, whose main entrance will be near the intersection of Pitt St and Beresford Square. The station will be the CRL’s deepest at 33m underground and have 150m long platforms stretching from Mercury Lane to Beresford Square.
The City Centre zoning that applies to 16-18 Beresford Square allows for the highest density of development under the Auckland Unitary Plan and encourages a wide range of commercial and or residential activities.
The development controls for the area the property is situated in provide for building heights up to 35m although there is volcanic view shaft restriction at a level of approximately 26m over the site. The basic allowable Floor Area Ratio (FAR) is four sq m of buildings to one sq m of land with a maximum FAR of 6:1.
Beresford Square runs between Pitt Street and Hopetoun Street and the property is less than 100 metres from Karangahape Rd and a short walk from Ponsonby Rd as well as being close to multiple motorway onramps and many bus transport links.
The surrounding area comprises predominantly original character buildings plus a growing number of modern apartment developments in the increasingly popular Ponsonby Ridge precinct. Beresford Square has a number of heritage buildings including the former central fire and ambulance station building and the Hopetoun Alpha hall sold by Haydock and Bullick earlier this year.
“Once completed, the Karangahape station will provide improved connections to the Auckland CBD and Britomart Transport Centre as well as fringe central city suburbs such as Mt Eden, Kingsland and Morningside,” says Bullick. “With such convenient access to amenities and popular precincts, this location is set to continue to grow and flourish and businesses located there are likely to benefit from significantly increased pedestrian numbers. Forecasts suggest that by 2035, the number of passengers passing Karaganghape Station at peak travel times will be approximately 54,000 per hour.
Haydock says the CRL will be a game changer for the historic K Rd precinct and enhances the rejuvenation and intensification of activities that is already occurring in the area to the benefit of its property owners.
He says over the next few years, the street environment will be transformed by the $16 million Karangahape Road Enhancement project – a collaboration between Auckland Council, Auckland Transport and central Government – designed to make K Road safer and more appealing in advance of the CRL station opening.
Planned improvements include separated cycleways and cycle parking, peak hour bus lanes and bus stop relocations, rain gardens plus trees and landscaping, changes to parking, upgraded street lighting, street furniture and art and opportunities for outdoor dining and street activities.