Changes to on-street car parking policies in the capital and an increasing inner city residential population are putting pressure on the city’s parking options which underscores the investment value of a central Wellington parking building that is for sale.
The building at 31-35 Boulcott Street, at the corner of Church and Boulcott Streets, has only come to the market once previously, and comprises a 1980s purpose-built five-level carpark building with easy access to and from the motorway.
The 95 car parks are fully-leased to established operator Wilson Parking Limited, and the property also has income from a billboard operator.
There are resource consents in place to unit title the car parks floor-by-floor, and for adding six levels of apartments or commercial accommodation above the existing structure, that can be transferred to a new owner
A 2014 detailed seismic assessment (DSA) by engineering consultancy Beca, assessed the building as being approximately 100 percent of new building standard, and a 2019 Geotech report is also available on request.
Returning annual net passing income of $221,740 plus GST, and with built-in annual rental growth, agents said the property’s solid cash flow and low-maintenance characteristics make this a simple investment proposition for either a passive or an add-value investor.
Tenders for the property close at 4pm Wednesday 28th June, with Mark Hourigan and James Higgie of Bayleys Wellington Commercial.
Describing it as a rarity in the market, Hourigan said the building would suit a traditional investor wanting to clip the income ticket passively, one with an appetite to do the proposed development, or a buyer looking for a “hold and wait” opportunity with a view to future redevelopment down the line.
“The carparking building is surrounded by office buildings that are under-resourced with on-site parking of their own, and there’s easy pedestrian access to the CBD from this location, so there’s a sitting audience for operator Wilson to capture.
“Additionally, with council reportedly removing around 1200 on-street car parks as part of a city-wide cycleway rollout, and others making way for a number of kerbside parklets in the inner city, the casual parking situation is tight for workers, shoppers and residents.”
Hourigan said despite some lingering market headwinds, there are still developers pushing on with accommodation projects, with experienced and established entities signalling they are looking to expand their footprint in the capital and elsewhere around the country.
“There are not a lot of opportunities to acquire accommodation development space in the city centre, so a property such as the Boulcott Street building, which has resource consent for development. has definite upside for accommodation providers and apartment developers.
“The build-to-rent market is also taking off in New Zealand, and with capacity for a six-level development above the existing structure allowable, the options really open up for an astute buyer.”
Development plans include a common area rooftop facility with media lounge, library, gym, barbecue area and indoor and outdoor dining facilities which would have wide appeal for build-to-rent, short stay accommodation clients or apartment buyers.
With the existing carparking asset being of low maintenance construction and not having any expensive services or fit-out to maintain, Hourigan said it is a straightforward earner with opportunities to unlock further value – even if the upper development is paused for some time.
“With the number of electric vehicles in Wellington expected to grow in coming years, a new owner could investigate the feasibility of installing chargers in the building which could further extend its appeal to users.”
The building is constructed from reinforced concrete with poured in-situ concrete floors supported on concrete columns and beams with concrete block infill.
Floor plates increase in size as the structure steps up the site, with separate access to levels 1-4 and an internal ramp from level 4 to the upper rooftop level 5.
All levels are naturally ventilated, with steel grilles fitted to wall openings at street level for security purposes.