A character Meadowbank building on a busy arterial road with a mix of retail and residential space is among a wide range of commercial and industrial properties...
...that will go up for auction early next month as part of Bayleys’ third Total Property portfolio for the year.
The 254 sq m building on a 223 sq m freehold site at 16-18 St Johns Road, Meadowbank has two ground floor retail premises and a three-bedroom residential flat above. It is being marketed by Cameron Melhuish and Andrew Wallace of Bayleys Auckland and will go under the hammer in Bayleys’ central Auckland auction rooms along with 12 other commercial and industrial properties on July 6, unless sold prior.
Melhuish says the current owner has just completed a major strengthening and refurbishment of the property.
“Originally built in the 1930s, the building has been seismically upgraded and significantly refurbished combining the best of the old and the new – a charming character building but now with a favourable earthquake rating and internal modernisation.”
Melhuish says to minimise disruption to the ground floor tenants, strengthening works were predominately done via the upstairs residential flat which was gutted back to its external and load bearing walls to enable the building to be upgraded to a minimum of 70 per cent of New Building Standard.
The 80 sq m flat with an external deck of close to 10 sq m was then fully rebuilt and now comprises an open plan kitchen/dining area, three-bedrooms and two bathrooms.
“It is yet to be lived in - all fixtures, fittings and finishes are brand new and new decking off the lounge provides outdoor living options plus sweeping north facing views of both the surrounding suburbs and the Waitemata harbour,” says Melhuish. “The two established retail ground floor tenants, a dairy and liquor store, were retained through the renovation process. Each shop has also been internally modernised as part of this, with new ceilings and light fittings, and were freshly painted.”
Melhuish says additional works included the upgrading of each tenancy’s fire rating to meet council requirements. The flat has been fully rewired and the shops received new wiring where required and each tenancy has been fitted with individual water and power meters. The roof was also refurbished and the external street front canopy upgraded with new box gutters and roofing.
The liquor store occupies 100.5 metres of ground floor space on a long term lease which following the refurbishment has been extended until March 2026. The lease has a fixed rent increase in March 2018 based on the increase in the CPI plus 2.5 percent. The 74 sq m dairy has a lease until February next year with one final two-year right of renewal.
The two shops are currently producing net annual rental income of $80,544 plus GST. Melhuish says two independent rental assessments put the flat’s weekly rental in the $750 to $825 per week range, which means the property could generate potential annual rental income of close to $120,000.
“The vendor has decided not to let the flat to provide additional flexibility for a new owner who may want to explore the option of living on the premises and using the rental from the shops to help fund the acquisition.”
Wallace says the property enjoys a high profile position on St Johns Road near the corner with Meadowbank Road which provides access to the rear of the premises via a right of way. It is located in the heart of the Meadowbank shops, a boutique commercial precinct comprising a number of character buildings with long-standing tenants including the iconic Meadowbank Bakery which has “been baking since 1937” and the Corner Chemist. The Meadow, a popular café/restaurant, is located next door.
“St Johns Road is a busy arterial which connects St Heliers and Remuera and provides access to the southern and northern motorways via the Greenlane interchange,” says Wallace. “Retail tenants enjoy plenty of exposure to high traffic flows and also benefit from being surrounded by some of Auckland’s most affluent residential suburbs including Meadowbank, St Johns and Remuera. The strength of this location is underlined by the lack of vacancy in the area and the speed in which any vacant retail spaces are leased.”
The property is currently zoned Business 1 which allows for a wide range of activities and Local Centre under the Proposed Auckland Unitary Plan. This zoning applies to a large number of centres throughout Auckland where good public transport is available and provides for the local convenience needs of surrounding residential areas.
“The allowable building height under this zoning increases from 10 metres to 16.5 metres, with residential permitted on upper levels. This provides further future potential development upside for this property particularly given its elevated ridge position,” says Wallace.
“This property is a premier investment opportunity that has everything a buyer should be looking for – freehold tenure, diversified income streams, a high profile main road location, a favourable seismic rating and further add value potential under its unitary plan zoning.”