Christchurch’s newest suburban retail and commercial hub is being sold down – offering investors unit title opportunities to secure investment property in the city’s fast-growing coastal quadrant.
The new hub at 987 Ferry Road in the south-eastern Christchurch destination of Ferrymead is appropriately named the 987 Centre. New tenants in the precinct began moving in during the latter part of October, with many of the remaining tenancy spaces under negotiation. The balance of the two hectare site is being developed as the new Mega Mitre 10 Trade drive-through.
Now all 14 unit titles, including car parks, in the 987 Centre are being marketed for sale individually by way of auction on December 1. Bayleys Canterbury Commercial salesperson Blair Young says the development sits on a high profile 5477 m² location with a 110 metre road frontage.
The 987 Centre retail hub overlooks Ferry Road which is the main arterial route linking central Christchurch with the coastal suburbs of Mount Pleasant, Redcliffs and Sumner – with a daily average traffic count of approximately 20,000 vehicles underpinning a substantial passing trade. Latest 2013 Census figures record 28,000 people living in the coastal suburbs and surrounding areas.
The 987 Centre also adjoins other substantial Ferrymead shopping complexes – featuring a conglomeration of hospitality operations such as Winnie Bagoes, Cosa Nostra Italian restaurant, Pizza Hutt, the Ferrymead Speights Ale House to name a few, main trading banks, fitness centres, medical and veterinary practices through to large retailers such as Mega Mitre 10 and the 4400 m² Countdown supermarket.
“With a high passing traffic count – sustained by a well-established surrounding resident and worker populations – we are expecting strong buyer interest from investors and potentially owner occupiers securing the remaining few vacant spaces,” Mr Young said.
“The appeal for these14 units going under the auctioneer’s hammer comes from having newly-built premises, constructed to 100 percent of New Building Standards, with a diverse range of established tenancies on long leases in a prime location. It’s the perfect buyer check-list.”
The tenancy mix within the 987 Centre hub features a veritable ‘who’s who’ of the retail sector. The 987 Centre is anchored by two of the major retail banks – ASB and ANZ, along with two of New Zealand’s foremost travel agencies – House of Travel and Flight Centre, and well known and nationally-branded convenience food outlet Pita Pit. Confirmed additional tenants are Bayleys, T-Sushi and Casbah Moroccan Grill.
Mr Young said the remaining unoccupied 987 Centre units would suit high volume lifestyle retail services, food and beverage operations and offices.
“New Zealand retailing, particularly in suburban destinations, has seen several development and geographic trends over the past decade – from the emergence of ‘big box’ retailing hubs attracting the likes of Mitre 10, Farmers, Harvey Norman, and Noel Leeming, through to suburban retail convenience hubs such as the 987 Centre in Ferrymead,” Mr Young said.
“These smaller neighbourhood complexes are predominantly based around short stay retail experiences, and are based on the cornerstone of food and beverage purchases.
“From this retail core, social amenities are bolted on – such as banks, medical centres, pharmacies, and 24-hour swipe card gymnasiums come into their own,” Mr Young added.
“The strategy for suburban convenience retail hubs is to lease to complimentary businesses in what is known as a ‘jig-saw’ mode where individual pieces fit together to create a bigger picture.
“The most common example of this is your typical Friday or Saturday night in the suburbs in virtually every New Zealand city – where dad and the kids get sent ‘down the road’ by mum to purchase dinner for the family and simultaneously pick up a six pack of beer and a bottle of wine to take home too.
“From a town planning and business model perspective, the establishment of the 987 Centre embraces two of the fundamental requirements for a successful retail hub. Firstly, it is adjacent to a high traffic arterial road with easy access and ample car parking. And secondly, it is the centre of a moderately affluent residential socio-economic catchment zone.”
THE TENANTED OFFERING
Unit 1 – ASB
The ASB Group of companies is one of the largest providers of financial and insurance services in New Zealand.
A 161.9 m2 unit with four car parks. Currently on a six year lease with two further three-year rights of renewal and rent reviews every three years. Current net rental $59,265 per annum.
Unit 4 – Flight Centre
Flight Centre New Zealand Ltd is part of Flight Centre Travel Group - an independent, Australian-owned travel group. The company’s travel experts organise flights, holidays, hotels, car hire, cruises, travel insurance, coach tours, visas, traveller's cheques, and frequent flyer points redemption.
A 93.8 m2 unit with two car parks. Currently on a six year lease with two further six-year rights of renewal and a three percent rental increase every year. Current net rental $34,130 per annum.
Unit 5 – Pita Pit
The market strengths of Pita Pit in comparison with other convenience food outlets are its healthy, low-carbohydrate and low-cost products, a quick service average of 90 seconds preparation, extended operating hours and its popularity among working professionals and students "who care about what they eat".
A 108.5 m2 unit with three car parks. Currently on a 10 year lease with three further five-year rights of renewal and rent reviews every three years. Current net rental $48,951 per annum.
Unit 6 – Casbah Moroccan Grill/Bayleys Canterbury
A ‘split unit’ featuring a North African cuisine eatery and a new office for New Zealand’s leading full service real estate agency. Both tenant companies will operate out of totally separate parts of the joint unit which comes with a total of seven car parks.
Casbah Moroccan Grill occupies 180.34 m2 and is currently on a 10 year lease with three further five-year rights of renewal and rent reviews every three years. Current net rental $75,869 per annum.
Bayleys Canterbury occupies 111.5 m2 and is currently on a six year lease with three further three-year rights of renewal and rent reviews every three years. Current net rental $46,927 per annum.
Unit 7 – T-Sushi
Traditional-style sushi and noodle convenience food outlet for both eat-in and takeaway clientele.
A 128 m2 unit with six car parks. Currently on a 10 year lease with two further five-year rights of renewal and rent reviews every two years. Current net rental $48,735 per annum.
Unit 10 - ANZ
ANZ is one of New Zealand's largest companies based on profit and assets - employing some 9,000 people throughout New Zealand.
A 209.5 m2 unit with six car parks. Currently on a six year lease with two further three-year rights of renewal and rent reviews every three years with a Consumer Price Index-linked increase every year. Current net rental $73,454 per annum.
Unit 11 – House of Travel
House of Travel is the largest privately-owned travel services company in New Zealand, and the third largest travel organisation in the Asia Pacific region. The House of Travel Group employs close to 2,000 staff operating in a number of different brands and businesses, including some 75 House of Travel retail travel stores throughout New Zealand.
A 144.4 m2 unit with five car parks. Currently on a six year lease with two further three-year rights of renewal and rent reviews every two years. Current net rental $54,937 per annum.