A duo of office buildings with tenants including McDonalds and Te Whatu Ora Health New Zealand have gone up for sale with considerable potential for future redevelopment.
Underpinned by more than 5,200 square metres of freehold land, the property for sale in Auckland’s Greenlane contains two standalone three-storey buildings and plentiful parking.
The fully leased offices at 302 and 308 Great South Road are home to McDonalds’ New Zealand headquarters, along with national public health body Te Whatu Ora, clothing company Hanes, Construction Marketing Services, Oxford Finance, and New Zealand Blood & Organ Services.
The property generates a total net rental return of $1,309,509 plus outgoings and GST per annum.
Given its modest building coverage, flexible intensive zoning, site profile and central Auckland location, the property is ripe with longer-term potential for redevelopment with a multistorey commercial, mixed-use or residential project.
The freehold land and buildings at 302 and 308 Great South Road, Greenlane, Auckland, are being marketed for sale on behalf of NZX-listed property company Argosy, by Ian Hall and Layne Harwood of Bayleys Real Estate as sole agents.
The property will be sold by way of deadline private treaty closing on Thursday 14 September, unless it is sold prior.
Hall said the property consisted of two similar-sized buildings with a combined lettable floor area of approximately 3,457 square metres on some 5,240 square metres of freehold land, with 116 car parks.
“The buildings feature a flexible, generally open-plan layout with plenty of natural light. Each floor is fully self-contained with separate toilet and kitchen facilities and the ability to accommodate split tenancies on each level.
“Developed by Fletchers in the mid-1980s, the premises have undergone various upgrades including to the lifts, air-conditioning and ceilings as well as common area foyers, stairwells and toilets. Their well-maintained condition reflects the high levels of asset management typical of their ownership by a listed property company,” Hall said.
Both office blocks have an A+ grade seismic rating of 100% NBS. One of the buildings has a 4.5-star base building NABERSNZ rating while the other building is under assessment.
The property is close to the Greenlane motorway interchange, one of Auckland’s busiest, and affords easy access to arterial routes and public transport networks including the southern rail corridor.
“High-profile service provider occupiers are attracted to this location, due to the central position, close access to the Southern Motorway, and plentiful on-site car parking. These features have assured the buildings of high occupancy levels.
“The central Greenlane location also offers tenant businesses excellent profile to main arterial Great South Road,” said Hall.
Harwood said add-value options for a new owner were multiple.
“There are good prospects for future rental growth, and low vacancy levels within the immediate location will assist in protecting future investment value.
“With the lease terms generally being relatively short, there is flexibility to reposition the occupier profile with longer lease terms or to harness the holding income from existing leases while adopting a medium-term redevelopment strategy,” he said.
Harwood said the property was underdeveloped, with the gross floor area well below what would normally be permitted. This meant there are opportunities for a new owner to add buildings or undertake a complete redevelopment proposition.
Business – Town Centre zoning supports a range of uses with a 24-metre building height limit allowing for an eight-storey building, subject to development controls.
Permitted activities range from the existing office use to integrated residential development, visitor accommodation, commercial services, retail, education and healthcare.
“Given the low building coverage, development-friendly zoning and strategic location, a future mixed-use redevelopment proposition here would likely include a significant residential component.
“Being positioned next to Countdown Greenlane, there’s an opportunity to leverage the supermarket with complementary retail and commercial uses on ground and lower floor levels, with apartments above.
“Dual egress and around 50 metres of frontage to Great South Road only add to the site’s advantages for a future development,” Harwood said.