As tourism metrics start trending upwards again and corporate business returns to some semblance of normality, agents marketing the freehold land and buildings for a popular and well-performing Mount Maunganui motel property are expecting strong interest from investors looking to enter the coastal town’s commercial accommodation market.
Declaring it a rare opportunity to secure a substantial stand-alone motel site with high underlying land value in one of New Zealand’s most desirable beach resorts, the Baywatch Motor Inn motel complex in Mount Maunganui has an extended lease in place, with in-built rental growth.
Purpose-built in 1997 and operated for an extended time by the current vendors before selling the operating lease, the two-level 992sqm property has 17 motel units and generous managers’ accommodation, is close to the Midway shops and around 1km from the Mount town centre.
Located at 349A Maunganui Road, the property is around 600 metres from the ocean beach front with direct access via nearby Grove Avenue, while Pilot Bay beach on the harbour side of Mauao -Mount Maunganui is within walking distance of the motor inn.
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The lease to Ardnave Properties Limited, trading as Baywatch Motor Inn, extends to December 2045, and returns current annual net income of $214,270 plus GST and operating expenses.
The rent is reviewed every two years and the lease includes a maintenance fund component of 4-percent of annual net rental plus GST, and a five-yearly redecoration clause.
The freehold interest in the property will be sold by deadline private treaty closing 4pm, Thursday 10th August, unless sold prior through Brendon, Lynn and Ryan Bradley of Bayleys Tauranga.
The substantial motel complex provides 17 recently-refurbished studio and one-bedroom units and a three-bedroom managers’ residence with double garage on a 1,690sqm slightly elevated landholding with an expansive road frontage and including 18 on-site car parks, plus a guest plunge pool.
Brendon Bradley says given the immensely desirable investment locality, the intrinsic underlying land value and strong rental growth potential, this motel asset must appeal to astute investors seeking to acquire a proven performer for a long-term hold.
“This is a bottom-drawer passive investment opportunity that seldom becomes available in the tightly-held Mount market, where motels do particularly well with holidaymakers and corporate representatives.
“Baywatch is an example of a well-run, well-maintained motel asset that has enjoyed strong occupancy across market cycles.
“It has proudly remained a flagship accommodation provider for the visitor and corporate market as opposed to the long-term rental sector and the long-term lease cements it as a robust investment proposition.”
Bradley says the property’s Suburban Residential zoning underpins the future value of the large freehold site, particularly in light of changing density fundamentals that are likely to apply in time.
“Mount Maunganui is an enduringly-popular town with Mauao a focal point and the surf beach and harbour a bonus.
“Commercial investors scramble to secure opportunities and from a returns and security perspective, this property is a standout – especially in light of the favourable lease terms and significant scope for future rental growth on the 2024 market rent review date.”
Maunganui Road is the main arterial route leading into the Mount town centre and the property has a high profile to passing traffic.
Development in this area is predominantly residential with surrounding commercial businesses nearby providing a diverse range of activities including retail, hospitality, visitor accommodation and professional offices, plus a number of apartment blocks.
The site is within close proximity to the Zespri Head Office, Bay Oval Cricket ground, Adams Centre for High Performance Sport and the Port of Tauranga Head Office.
- Article supplied by Bayleys
