The sale of 250 individually-titled, freehold car parks is generating strong interest as demand from investors intensifies for hands-off, income-producing assets.
Split into five blocks of 50 car parks, offered for sale individually or together, the parking spaces at 2-4 York Street are in a high-profile building less than 100m from Newmarket’s golden mile, Broadway.
Bayleys Auckland City & Fringe Associate Director Phil Haydock says the parking spaces are offered to the market at a time investors are seeking diversification in their portfolios amid variable economic conditions and political uncertainty.
“Given the general tilting of the regulatory playing field for residential investors in recent years – with a focus on tenants’ rights, landlord obligations, and tax reforms removing the ability to deduct interest costs when calculating profit – residential investors are looking to broaden their horizons with less complicated assets.
“For those just dipping their toes into the commercial sector, car parking presents an affordable and low-maintenance entry, secured by long-term leases and increasing demand in central areas.
“It’s rare to have such a large volume of prime car parking available for sale in a vibrant commercial hub, and rental growth is assured given the current challenges around urban car parking and public transport options.
“Developers are no longer required to provide mandatory car parks in residential projects, which has placed enormous pressure on existing parking infrastructure.
“Supported by ongoing demand and a steady income stream, the long-term fundamentals of this investment provide broad appeal, particularly given the central Auckland location with strong connections to other metropolitan areas,” he says.
Mr Haydock is marketing the premises for sale with colleagues Alan Haydock and Damien Bullick via tender process closing at 4:00 pm on Tuesday, 25th July 2023 (unless sold prior).
Located on a 2,254sq m corner site, the building features six levels of car parking with an A-grade seismic assessment and Business – Metropolitan Centre zoning.
Completed in 2000, the building comprises ground floor retail, a total 382 car parks, external signage and a commercial premises on the top floor, currently occupied by a ten-pin bowling operator.
Interested parties can purchase individual blocks of 50 car parks or the package of 250 car parks and three signage titles.
The car parks generate a combined total net annual income of circa $875,607 plus gst from a lease to New Zealand’s largest parking operator, Wilson Parking New Zealand, and signage to Kent Holdings.
A single block of 50 car parks generates a net annual income of approximately $171,067 plus gst.
Bayleys Auckland City & Fringe Team Director Alan Haydock says revenue from the car parking is not only underpinned by the long-term leases of 12 years to Wilson Parking, but also ‘future-proofed’ with annual two percent rental reviews written into the lease terms.
“Ease of access to the office is crucial element operators are considering when trying to compete with the ‘work-from-home’ movement, and higher density office configurations, particularly in central areas, constantly require more parking spaces to meet staffing demand.”
Newmarket is a key metropolitan hub, home to one of Australasia’s largest shopping centres, the University of Auckland’s Newmarket campus, and the desirable double grammar school zone precinct.
“The immediate location is one of the city’s most valuable residential and employment hubs, predicted to grow significantly in the years ahead, providing future upside potential for investors seeking crucial diversification in an area of growing significance,” Mr Haydock says.