A modern high-profile Hastings commercial building with prominent main street frontage and four split tenancies across a range of industry sectors has been placed on the market for sale.
The two-story building occupies a prime corner site on the intersection of 729 Heretaunga Street and Greys Road. Its multi-angled design and construction make it one of the most modern in the commercial and light industrial strip linking Central Hastings with the city’s industrial zone.
Sitting on 1268 square metres of freehold land, the 623 square metres building generates annual rental returns of $92,881. The four tenants within the property are:
- Education provider Te Wananga o Aotearoa which has a lease expiring in 2017 with one further two-year right of renewal, generating $41,353 per annum. Te Wananga occupies 215 square metres of space and has five allocated car parking spaces.
- Finance company CentraCorp which has a lease expiring in 2018 with two further two-year rights of renewal, generating $22,150 per annum. CentraCorp occupies 70 square metres of space and has two allocated car parking spaces.
- Agri’ product marketing firm Valagro which has a lease expiring in 2017 and is generating $19,000 per annum. Valagro occupies 123 square metres of space and has four allocated car parking spaces and,
- Accommodation marketing organisation Host Accommodation which has a lease expiring in 2016 and is generating $12,200 per annum. Host Accommodation occupies 67 square metres of space and has one allocated car parking space.
The building is being marketed for sale at an auction on October 9 by Bayleys Napier, and is being mooted as an investment opportunity with potential added-value avenues. Bayleys Napier salesperson Paul Garland said the internal configuration of the building allowed for all four tenancies to co-exist independently of each other.
“The building has three separate entrances – with Valagro and Host Accommodation sharing a central foyer space leading into their respective locations,” he said.
“From a long-term or development perspective, the internal floorplates of the individual tenancies means they could be easily reconfigured into three, two or even one single entity.”
However, Mr Garland said the split tenancy business model for the property delivered a low-risk investment strategy. Profiling the individual tenants, the Hastings Te Wananga campus is one of 92 such learning sites nationwide – offering a range of certificate, diploma and degree courses in business, trades and vocations.
CentraCorp is a finance company operating in the motor vehicle sector and has been an anchor tenant in the building since it was constructed – choosing to be close to the numerous car sales yards trading along Heretaunga Street.
The Hastings office of Italian-based Valagro is one of 12 such branches around the world. The company is prevalent in the production and marketing of bio-stimulants and fertilisers Host Accommodation is a conglomerate of motels, motor inns, and motor lodges located from Kerikeri to Invercargill – with the marketing and administrative services running from the Hastings-based head office.
Mr Garland said the core structure of the 1980s-built premises was added to in the early 1990s, and was now certified to 73 percent of New Building Standard (NBS). The building’s timber-framed bracing walls were held in place by steel support trusses and encased in fibre cement cladding with aluminium window joinery.
He said that with 38 metres of frontage onto Heretaunga Street and 35 metres of frontage onto Grays Road, there was the opportunity for a new owner to look at increasing the property’s revenue potential by the installation of advertising hoardings or billboards.Mr Garland said activity in Hawke’s Bay’s commercial office and industrial property markets – outside of premises involved with the primary productive sector – has remained relatively subdued for the past three years, offering some good investment returns with yields averaging between 8–10 percent.
“This has led to increased vacancy rates amongst poorer grade commercial premises in Hastings. The property however - with the established tenancies benefitting from competitive per square metre leasing rates at a prime location in a well-maintained building - has certainly bucked that trend,” he said.