The land and buildings housing a vertically-integrated hospitality hub in one of New Zealand’s foremost beach towns has been placed on the market for sale.
The properties at 8 – 10 Inlet Road in the middle of Kaiteriteri at the top of the South Island houses the popular Kaiteriteri Beach Lodge and adjoining Beached Whale – consisting of a restaurant and bar, motel-style accommodation, and backpackers’ dormitories. They also sustain an owner/manager’s residence.
Some 50 metres from the beach, the Kaiteriteri Beach Lodge and Beached Whale venues are both purpose-built premises sitting on a combined site of some 2,182 square metres of freehold land in two titles. The two hospitality businesses are operated by the same tenant, but as separate entities.
Number 8 Inlet Road houses the 900-square metre Kaiteriteri Beach Lodge and Beached Whale operations which currently generate rental of $240,000 per annum.
The 80-bed two-storey accommodation arm of the enterprise encompasses a broad selection of room configurations. On both floors, these range from bunk style four, six and eight-bed dormitories and single rooms, through to motel-grade units with en-suites.
Each level also has shared bathroom and toilet facilities servicing the dormitories, with the communal kitchen located on the ground floor.
Immediately next door are 12 portacom cabins converted into accommodation units and supporting shower and bathroom amenities.
Adjacent to the accommodation options is The Beached Whale bar and restaurant, which is licensed to serve up to 80 patrons. Promulgating a summer ‘vibe’, the open-plan/high stud venue features both extensive indoor and outdoor seating arrangements – with the alfresco areas situated both at the street frontage and rear courtyard of the property.
Meanwhile next door, 10 Inlet Road contains the two-storey three-bedroom 108-square metre owner/managers home. The dwelling currently generates annual rental of $26,000.
Now the Kaiteriteri Beach Lodge and Beached Whale land and buildings, including the owner/manager’s residence being marketed for sale by negotiation through Bayleys Nelson.
The businesses are not included in the sale. Both properties are being sold with new leases being offered under negotiation - with the tenant looking to negotiate long renewal terms with any new owner.
Bayleys Nelson salesperson Gill Ireland it was rare for commercial-grade investment opportunities of this dynamic to come onto the market in the Western Tasman region.
“Accommodation lodges come onto the market from time to time, as do B & Bs, and occasionally the buildings with bars or fast food outlets as tenants – but certainly nothing offering commercial accommodation and adjoining hospitality operations on this size and scale,” she said.
“Usually, such properties coming onto the market are advertised as land, buildings and business for sale. The Inlet Road duo are purely investment properties – with the current business operator well entrenched in the local community, and looking to remain as the long-term tenant.”
She said both the new lease negotiations could be undertaken in conjunction with the land and building purchase in order to reflect any new owner’s potential future uses of the two sites.
“From a tenant’s perspective, Kaiteriteri Beach Lodge and Beached Whale operate in a symbiotic nature – with guests staying in the accommodation enjoying the convenience of have a casual dining restaurant and bar right next door. And for Beached Whale, that arraignment delivers high customer numbers year-round – particularly over the summer seasonal months,” Ms Ireland said.
The neighbouring 8 - 10 Inlet Road properties sit directly across the road from the Kaiteriteri Beach Holiday Park campground. Number 8 Inlet Roads is zoned commercial 8A under the Tasman District Council plan, while Number 10 Inlet road is zoned residential 9S.
“It is unusual to find neighbouring commercial and residential properties both being offered for sale with commercial leases in place. But with the residential component of the properties so integral to the operations of the hospitality businesses next door, the arrangement underpins both entities,” Ms Ireland said.