New-look residential complexes for sale will help tackle housing crisis
The standalone multi-unit complexes nearing completion in high-growth areas in Henderson and Flat Bush are part of an innovative rental housing model built around affordable residential studios.
The properties for sale come with new six-year leases to registered community housing providers (CHPs), which will rent out the units under service agreements with the Ministry of Housing and Urban Development.
The CHPs’ “semi-gross” leases, including some outgoings, will result in Government-backed net rental income from each property of approximately $1,250,000 plus GST per annum. The leases incorporate fixed two-percent annual rental increases, with a market review after three years.
The freehold properties at 57 Henderson Valley Road, Henderson, and 169 Chapel Road, Flat Bush, are being exclusively marketed for sale together or individually through Bayleys Auckland Central. Sale will be by way of a tender closing at 4pm on Tuesday 13 April, unless they are sold earlier.
57 Henderson Valley Road, Henderson
This complex, known as Henderson Valley Studios, is comprised of three separate blocks with a total floor area of some 2,478 square metres, on 4,957 square metres of freehold land, zoned Business – Light Industry. The blocks house 18 residential units incorporating a total of 72 studio rooms, supported by 47 car parks.
• Net rental: $1,250,00 + GST (estimated); two percent annual increases, market review after three years
• Lease term: Six years, with a further three-year right of renewal
169 Chapel Road, Flat Bush
With five blocks totalling approximately 2,654 square metres on a freehold site of some 2,899 square metres, the complex known as Chapel Road Studios features 15 apartments incorporating 75 studio rooms, along with 30 car parks. The site is zoned Residential – Mixed Housing Urban.
• Net rental: $1,250,00 + GST (estimated); two percent annual increases, market review after three years
• Lease term: Six years
Salespeople Ian McGowan and Alan Haydock said the two complexes had been developed based on a proven StudioHomes model for affordable, furnished studio accommodation by specialist residential property developer the Clarke Group.
Mr McGowan said the group had already successfully delivered nine StudioHomes complexes in locations including Manurewa, Manukau and Swanson, with two more nearing completion.
“Together these total more than 500 studio bedrooms, and these have generally achieved 90 to 100 percent occupancy. The Clarke Group’s model enables it to meet the needs of lower-income residents with gross rentals for studio rooms typically between $340 and $360 per week – significantly lower than the median Auckland rent,” Mr McGowan said.
Each residential unit, or apartment, at Henderson Valley Studios and Chapel Road Studios features fully-furnished studio bedrooms served by a common kitchen, lounge and laundry facility. Units at Henderson Valley each incorporate four studio rooms, while those at Chapel Road have five.
The two properties are fully fenced with extensive landscaping, a paved outdoor communal area and designated car parks,” Mr McGowan said.
Mr Haydock said the two entire residential complexes would be delivered “turn-key”, ready and fully managed by professional service providers.
The Clarke Group’s residential studios model was unique in the Auckland housing market and had met stringent council requirements to be approved for use in transitional housing services provided by registered CHPs, he said.
“For investors, these properties represent a rare opportunity to invest in a residentially based under-supplied asset class, with fixed annual rental growth.
“Auckland has a large and well publicised deficit in affordable housing to rent or buy. The anticipated steady growth in Auckland’s population, combined with a soaring need for flexible, affordable housing, point to an enduring demand for this residential model.
“With Government-backed leases in place for each property from day one, each to a separate CHP, an investment in the two new complexes will be ‘recession resilient’. There is also considerable private demand for StudioHomes, providing options for future occupancy,” Mr Haydock said.
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