A high profile commercial building on the corner of Karangahape Rd and Upper Queen St is up for sale for the first time since it was built as bank premises 25 years ago.
Located on 359 sq m of land at 122-130 Karangahape Rd, the property is generating net annual income of $164,958 plus GST from a lease to ANZ Bank. It is being marketed by Matt Lee, Quinn Ngo and James Chan of Bayleys’ international division and is among a wide range of commercial and industrial properties which will go under the hammer on Wednedsday, May 16 as part of Bayleys’ next Total Property portfolio auction, unless sold prior to that date.
The three-level building was originally home to the National Bank when it was completed in 1992. Following its acquisition of National Bank, ANZ relocated from another location on Karangahape Rd and took over the lease on the property.
“The building is very well situated on one of central Auckland’s busiest intersection offering huge brand exposure to high volumes of traffic along K Rd, Queen St and Upper Queen St, so it’s not hard to see why ANZ would want to position itself there,” says Lee.
New Zealand’s biggest bank has perpetual three-year rights of renewal in its lease and exercised its most recent renewal in August 2017. Its rent is also reviewed to market every three years each time it exercises its right of renewal.
ANZ Bank occupies the whole premises which has an Initial Evaluation Procedure (IEP) seismic assessment of 100 per cent of New Building Standard.
“It’s an attractive, distinctively designed building with a double level atrium entranceway providing additional natural light,” says Lee. “It’s been solidly constructed and well maintained with roof repairs undertaken last year.”
The building comprises a ground floor area of 292 sq m which contains teller stations as well a strong room and separate offices with a mezzanine floor area above of 65 sq m containing staff amenities including a staff room.
A basement area, accessed off Upper Queen St, contains six car parks for customers and staff. Quinn Ngo says a range of public parking facilities are located within short walking distance of the building.
“The property is also surrounded by an interesting mix of retail outlets, cafes, eateries, entertainment and service outlets plus prominent mixed use office and retail buildings such as the Ironbank Building and St Kevins Arcade,” says Ngo. “It is situated in the heart of a vibrant commercial and residential precinct, which has undergone considerable rejuvenation in recent years – with a number of buildings and sites having been converted or redeveloped to higher intensity mixed commercial and in some cases residential uses."
The property is zoned Business - City Centre (Karangahape Road Precinct) which seeks to maintain and enhance the area’s distinctive form and street scape character and has a height limit of 35 metres.
Longer term, James Chan says should ANZ ever decide to relinquish its lease on 122-130 Karangahape Rd, a redevelopment of the site could potentially add considerable further value to the property.
“The neighbouring, award winning Ironbank Building, which is up to seven levels high, has set the benchmark for what’s possible in the area. The corner position of 122-130 Karangahape Rd adds to its development appeal, particularly for apartments on the upper levels because of the natural light and views this would provide.
“First and foremost though this is an exceptional freehold trophy property investment opportunity – the location and the tenant speak for themselves.”
Chan says the completion of the City Rail Link, scheduled for 2024, will add further impetus to the rejuvenation of Karangahape Rd, with an underground station to be located at road’s intersection with Pitt Street and Mercury Lane, a block away from the ANZ building. It will link with the Britomart transport hub via a station at Aotea Square and also connect with the existing western train line at a redeveloped Mt Eden Station.
The estimated $3.4 billion project will transform the Britomart Transport Centre into a two-way through-station that better connects the Auckland rail network.
K Road itself is scheduled for a major revamp. An enhancement project by Auckland Council and Auckland Transport will include a separate cycle way connecting to a network of existing and planned cycleways in the area; peak hour bus lanes and bus stop relocations; improved landscaping including rain gardens; upgrading street furniture and lighting and creating more opportunities for outdoor dining and street activities.