A street level office unit in a contemporary building is generating strong interest amongst passive investors eager to secure performing assets in Tauranga’s high-growth central business district.
The unit titled premises at 60A Durham Street is positioned to capture potential value uplift given its adjacency to the city’s $303 million civic redevelopment project and a slew of surrounding office and hospitality hubs.
Bayleys Tauranga Commercial & Industrial salesperson Ben Hoskin says the property’s key location, less than 100m from the epicentre of the civic redevelopment’s first phase, provides an inherent edge over comparable assets.
“The scope of private and public development works currently planned for Tauranga’s CBD is unprecedented and set to completely revitalise the inner-city precinct whilst attracting huge visitation and a higher calibre of local amenity.
“For assets within a close radius, this provides meaningful upside potential, particularly regarding rental growth, which remains a priority for investors looking through cyclical volatility.
“Current market dynamics have demonstrated the effectiveness of income growth in off-setting macro headwinds, a feature driven in Tauranga by an extremely tight supply of top-quality office accommodation.
“The market remains so undersupplied there is significant competition for A-grade premises, particularly in locations well-serviced by public transport and amenities.”
Mr Hoskin is marketing the Durham Street premises for sale by deadline, closing at 4:00 pm on Thursday, 18th May 2023 (unless sold prior).
Comprising a net lettable area of 477sqm (more or less) plus nine undercover car parks, the unit is leased to a subsidiary of a national franchise business, generating an annual net rent of $153,000 plus outgoings and GST.
Professional consultancy Residential Building Services, which specialises in comprehensive building services for related companies and property developers, has a new six year lease to September 2028 with two further three year renewal rights.
Mr Hoskin says the unit’s interior has been completed to a very high standard, providing a functional layout well-suited to the current occupant and future professional tenants.
“A mixture of open-plan and partitioned offices provide versatility for occupants while floor-to-ceiling windows and a corner aspect with a west-facing vantage point to main arterial Durham Street offers plenty of opportunity to capture pedestrian and passing vehicle attention.
“Secure basement car parking is a valuable commodity with parking at a premium in the CBD, particularly given a local council emphasis on increasing pedestrianisation. In addition to the unit’s exclusive car parks, extra spaces are located nearby in a four level parking building, and there’s the added benefit of public transport options virtually at the door.”
The premises features a seismic assessment of 80 percent of New Building Standard and is positioned within the City Centre zone, which enables a broad range of land use activities and a mandate to support local development.
Zone stipulations emphasise enhancing local amenity and developments that aid accessibility to and within the precinct for public and private transport.
“Durham Street runs the length of the mid-city precinct and is a critical arterial route which features several high-profile new developments, including the new Waikato University campus and the recently completed, multi-award winning 9,000sqm Trust Power head office.
“Other noteworthy developments include the $200 million Farmers project, which includes a residential component of high-end apartments, and Craigs Investment Partners’ $70 million ‘world office’ on Devonport Road.
“These projects are among 20 large-scale developments included in the Tauranga CBD Blueprint, which cumulatively total $1.5 billion in private sector investment into the city by the year 2030.
“Such significant capital outlay speaks to broad confidence in the future of Tauranga’s CBD as a world-class urban environment, inherently lifting the value proposition for assets in the area.”