The central Christchurch premises housing a leading national supplier to the hospitality industry and a major government department have been put on the market.
The Manchester Street property combines a modern, high-stud warehouse, showroom and office accommodation. It is fully leased to Southern Hospitality and the Department of Internal Affairs, along with a business utilising several on-site car parks, generating a total net rental return of $679,039 plus outgoings and GST per annum.
As a self-described ‘mega kitchen store for the hospitality and foodservice industry’, Southern Hospitality supplies everything from teaspoons to furniture to large-scale combi–ovens and food preparation equipment. The company stocks over 11,000 product lines imported from more than 35 countries.
Established in Dunedin in 1989, Southern Hospitality has grown into a major industry player providing a multitude of services, products and projects from a dozen locations nationwide.
It has delivered hospitality and corporate catering support for Te Pae Christchurch Convention Centre and, in its biggest project to date, a kitchens fitout for Auckland’s Park Hyatt hotel. Southern Hospitality has been exporting to the Pacific Islands since 2000.
The company last year received an offer to purchase 100 percent of its shares from Reward Supply Co Pty Ltd, part of French multinational foodservice supplier the ECF Group. The deal is subject to clearance by the Commerce Commission.
Southern Hospitality pays a net rent of $505,450 plus outgoings and GST per annum for its Manchester Street premises, on a current lease that runs through to late 2025 with two further five-year rights of renewal. The lease agreement includes market rent reviews every two years.
The Department of Internal Affairs has a wide-ranging remit including issuing passports, processing citizenship and lottery grant applications, enforcing censorship and gambling laws, and registering births, deaths, marriages and civil unions.
It has a total annual budget of over $870 million and employs 2,700 staff at 40 sites across New Zealand and overseas.
The department’s first-floor Christchurch office premises generate a net rent of $167,310 plus outgoings and GST per annum. The current lease runs through to December 2024 with a further two-year right of renewal and built-in annual rental growth of 2.5 percent.
The freehold land and building at 324 Manchester Street, Christchurch, are being marketed for sale through Stewart White and Alex White of Bayleys Christchurch.
Sale is by way of deadline private treaty closing on Thursday 29 June, unless the property is sold earlier.
Stewart White said the property consisted of an approximately 3,162-square-metre building on some 3,558 square metres of freehold land with 36 car parks.
“The tenancy occupied by Southern Hospitality encompasses approximately 1,200 square metres of warehousing with a 9.1-metre stud height and sizeable canopy, along with a 900-square-metre showroom and 450 square metres of first-floor offices.
“The Department of Internal Affairs occupies a further 445 square metres of office accommodation on the first floor,” he said.
Constructed in 2015, the property has a seismic rating of 100 percent of new building standard.
“This quality property offers flexible design and an abundance of car parking, along with dual access from Manchester and Aberdeen streets. Its convenient position on the northern fringe of the inner-city commercial and industrial area enables easy access to Bealey Avenue and other main arterial routes,” said Stewart White.
Alex White said the site sat within the Commercial Central City Mixed Use Zone under Christchurch’s district plan.
This provides for the continuation of existing activities and a wide range of other community, commercial, and business activities, while supporting the role of the Commercial Central City Business Zone as the focus for retail, offices, and commercial services.
“The sale of the Manchester Street property represents a rare opportunity for investors to secure a modern building combining a large high-stud warehouse, first-floor offices and ground-floor showroom in this tightly held central city location.
“The exceptionally strong tenant covenant, with both a national business and government agency in occupation, adds further to its attractions for commercial property investors,” Alex White said.