The freehold land and buildings of the flagship Marquis of Normanby Hotel on Carterton’s main thoroughfare are for sale, with a long-term lease in place following a recent empathetic refurbishment to long-stay rental accommodation by a social entrepreneur with strong community values.
The striking corner property has stood at 63 High Street North, Carterton, Wairarapa since 1924, with the two-level reinforced concrete structure replacing the original 1870s wooden hotel on the site and contributing to the strong character streetscape that the service town is known for.
The total building area is 920sqm, with the property occupying a 955sqm site with 16 car parks at the corner of High Street and Broadway, at the northern end of the Carterton commercial area.
The hotel building is owned by Anthony Walton and his wife Sarah Albisser, with the pair initiating and completing an extensive restoration of the property, including strengthening the property to 70 percent NBS, to provide secure, long-term accommodation.
The property now offers 25 well-presented individual bedrooms – some with ensuites, tasteful shared living spaces with modern furniture and artworks, multiple bathrooms, service rooms – including a coin-operated laundry – and outdoor areas.
The enterprising pair are looking to retain a lease over the whole Carterton property and continue its management with their company, Marquis Hotel Apartments Limited, retaining all of the business interests and entering into a new 25-year net lease with a buyer.
The full-net ratcheted lease comes with personal guarantees, and all operational outgoings will be covered by them as occupiers.
The property will provide annual income of $160,000, with built-in rental growth of 3 percent per year and reviews five-yearly.
Marquis Hotel Apartments Limited has subleased the ground floor commercial premises, which is now completely independent of the accommodation component, and it is operating as a lounge bar under management by an experienced local operator.
There is a Type 4 brigade-connected automatic and manual emergency fire warning system, emergency lighting, and compliant fire separation between the commercial and residential tenancies.
Tenders for the land and buildings close at 4pm, Wednesday 28th June via Andrew Smith and Mark Sherlock of Bayleys Wellington Commercial.
With a shortage of rental accommodation in Carterton and across the Wairarapa, and with limited options for young people seeking independence, Smith said the business model for the Marquis of Normanby which bundles quality accommodation with a caring management philosophy, is admirable and underscores the long-term profitability of this business.
“The vendors of the property are well-known for their community and outreach work both in New Zealand and overseas via their Global Tribe initiative,” he said.
“The idea with the Carterton property is to create an intentional community through a co-living model with support mechanisms in place for residents, and it has quickly gained strong occupancy.
“By freeing up capital from the sale of the land and buildings as a freehold investment proposition, the owners will then be able to continue developing similar projects elsewhere around the country.”
The recent renovation of the Naenae Hotel in Lower Hutt with a similar model of rental accommodation and social spaces by Walton and Albisser, is further evidence of the viability of the model.
Smith said the offering is essentially like a freehold motel investment, with a similarly-structured lease.
“Investors will recognise the value equation offered here, with a completely hands-off investment under sound management in a popular regional town that is benefitting from strong investment and growing tourism appeal.
“It’s a thriving settlement with good destination retail that leverages off the wider Wairarapa area’s attraction for Wellington day-trippers and weekend stays, along with other domestic tourism.
“With the character hotel re-envisioned as a fully leased residential accommodation offering, while still allowing public interaction by way of the ground floor lounge bar and pizzeria, the Marquis of Normanby has a positive future and stacks up as a compelling investment option.”
The hotel is named after George Augustus Constantine Phipps, Marquis of Normanby and Governor of New Zealand from 1874–78.