Prominently positioned on a high-profile corner site in central Tauranga, a two-level office building that is home to a government tenant has been placed on the market for sale.
Located at 65 Durham Street, the property offers 2,140sq m of total net lettable area on a 1,897sq m freehold site.
The Ministry of Social Development is the anchor tenant, and they are signed to a lease that runs until May 2025. CKL NZ, a team of professional land planners, land surveyors, and engineers, leases a portion of the building on a short-term agreement.
The property, which includes 24 on-site car parks, provides an estimated $500,530 in net annual rental income plus GST and operating expenses.
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The prime corner location is only one block from Tauranga’s CBD and the northeast-facing building has expansive road frontage providing high levels of visibility.
With Tauranga’s CBD set to expand during the next 18 months, the property is in an outstanding position to benefit from the nearby investment that will further enhance the working and shopping environment.
Colliers Brokers Simon Clark and Duncan Woodhouse have been exclusively appointed to market the property for sale by deadline private treaty closing at 4pm on Thursday 3 November, unless sold prior.
Originally constructed in the early 2000s, the building was developed for the Ministry of Social Development and comprises open plan and functional office space, alongside a staffroom, amenities, and a boardroom on the second level. CKL’s tenancy spans 259sq m of Level 2.
With a current NBS rating of 40 per cent, the property remains serviceable and Clark, Managing Director at Colliers Tauranga, says this presents a compelling value-add opportunity.
“The new owner will have the option of completing strengthening works, which will enhance the future rental opportunities for the building,” Clark says.
“Government tenants generally prefer to be based in buildings with at least a 67 per cent NBS rating and if the strengthening work was completed this would provide the current occupier with further incentive to recommit to a long-term lease beyond their current agreement.
“Alternatively, prospective purchasers may have new plans for the site and will look to make the most of the significant holding income from the current occupants before repositioning the property in the future.”
Tauranga has undergone continual growth in recent years and Woodhouse, Commercial and Industrial Sales Broker at Colliers Tauranga, says the city remains an attractive place for investment capital.
“Data from Infometrics shows the population of Tauranga has consistently risen for the past 25 years and at a rapid rate in recent times,” Woodhouse says.
“There are strong employment figures in the city and Tauranga’s regional employment grew by 0.6 per cent in 2021, higher than the national figure of 0.1 per cent.
“The regional economy also bucked the national trend as it grew by 0.3 per cent in 2021, underpinned by a dynamic business environment.”
Woodhouse says when examining all the pertinent factors, this property provides buyers with a wide array of options.
“Whether the new owner chooses to enhance the existing structure or redevelop it in the future, a property in this sought-after location will always generate strong interest in the market and we encourage all interested parties to contact us immediately.”
- Article supplied by Colliers
