A desirable provincial investment underpinned by a service station and strong tenant covenants on the main tourist and service route to the West Coast is scheduled for auction with Bayleys.

The large corner site on 3,392sqm (more or less) held in three freehold titles at 31-33 South Terrace and 1 Clinton Street is in a prime position in the centre of Darfield, a key thoroughfare for travellers along the Great Alpine Highway.

Bayleys salesperson Colin Askin says the property is offered to the market at a time when provincial investors have increased their market presence, encouraged by an improving economic outlook and tourism returning to the region.

“A higher interest rate environment has seen investors look to properties with strong tenant covenants and good cashflow for immediate value, while future development potential in a high growth area is encouraging for those seeking an investment with upside.

“The primary service station tenant has considerable operational experience in the sector with interests and ownership across the country, creating a solid value proposition for the property.

“The second tenant is involved in sales and servicing of Husqvarna products and the repairs and maintenance of chainsaws, ride-on mowers, related parts and hardware for which there is substantial appetite given Darfield’s high-performing farming economy.

“Both occupants contribute to property’s position as an excellent cashflow investment in the provincial heartland,” Askin says.

Askin is marketing the property for sale by auction at 12pm on Thursday, 29 September 2022.

The auction will take place at Bayleys’ Christchurch auction rooms at 3 Deans Avenue.

Completely redeveloped circa 2016, buildings totalling 480sqm (more or less) include the front tenancy, trading as a Challenge Service Station.

Spanning 272sqm (more or less), including a quality showroom, offices and amenities, retail accommodation, a canopy and forecourt plus underground fuel tanks and a carwash, the national operator has a new five year lease to April 2027 plus three further five-year rights of renewal.

Darfield Ag & Lifestyle centre occupies the 208sqm (more or less) rear tenancy with a three-year lease to June 2024 plus three further three-year renewal rights.

The rear title of 1,012sqm (more or less) at 1 Clinton Street is currently utilised by Kiwigas 2012 for bulk gas storage on a monthly lease generating an additional net annual income of $6,000.

The property generates a total annual net income of $204,576 plus GST and outgoings.

Askin says the property’s corner position with a functional configuration, which can support multiple independent tenants, provides a split-risk opportunity for future leasing, with scope for rental upside.

“The owner has redeveloped the property to a high standard, with a seismic assessment of 100% of NBS, nine car parks and concrete yards for storage, and vehicle manoeuvrability.

“Centrally located within Darfield, the site benefits from prime main street frontage with visible signage for tenants.

“Darfield has become an increasingly strategic provincial service centre for the surrounding prosperous arable, dairying and pastoral farming community, with a robust local economy buoyed by a substantial Fonterra milk processing facility nearby.

“Significant residential development has taken place locally within the region, making it a popular place to live and commute to work or schooling in central Christchurch.

“While the resident population has continued to increase, local facilities including two rest homes, schools, a supermarket, several cafes, a pharmacy, speciality shops and farming service providers are dotted across the community, creating demand for services from established operators.

“The town centre is a commercial focal point for a local population of around 3,500 people and performs as the main town between Christchurch – about 45 kilometres away - and the West Coast.

“Darfield is also a popular stop off for motorists travelling in either direction, with good passing vehicle movements during winter when tourists visit nearby sky mountains, and the remainder of the year for warm weather adventure activities,” Askin says.

Strong demand from through traffic is generated by the town’s position at the junction of State Highway 73, connecting Christchurch and the West Coast via Arthurs Pass, and State Highway 77, which connects Darfield with Ashburton and Methven.

Click here for more information on the listing.