A four-bedroom penthouse in central Auckland is expected to sell at an “extreme discount” when it goes under the hammer on Wednesday.
Scott Dunn, sales manager for City Sales, and colleague James Mairs are marketing the 270sqm two-level penthouse apartment in The Peaks, on 117 Victoria Street West.
Dunn told OneRoof: “We’re saying ‘if someone has $100,000 in their bank account, they should come to the auction’, absolutely, although we haven’t set the reserve. Any cash buyer at any [price] level, we’ll run it by the owner.”
He added that, unlike most properties on the company’s books where agents can offer a range of the likely prices at auction, he’s not sure on this one because the property has remedial issues.
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“Because the remediation cost is so close to the value, I wouldn’t like to guess. We don’t have many apartments to compare to, as Auckland buyers haven’t had the opportunity to buy big luxury apartments. But if it didn’t have remedial issues, it would probably be [worth] $2m to $3m.”
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Dunn said that the out-of-town owner bought the pad in mid-2015 for $1.28m and it is currently occupied by his children, but he now wants to get out.
The apartment, which has a CV of $1.825m, boasts two living rooms, four-bathrooms across two-levels, close-up views of Sky Tower and the Sky City entertainment precinct as well as views of the harbour. The decor is dated, but Dunn said a buyer would likely do an interior renovation.
The Peaks apartment block has remedial issues, with the owner of the penthouse facing building costs that may spiral up from $1m. Photo taken in 2017. Photo / File
He said the Body Corporate's early estimates of the share of remediation costs for the apartment, which comes with a generous four carparks, is about $1m but this may well change. “We always say [to buyers] these are current costings, but they’ve not started any work on the building just yet and there is no timeline, so it is very early days. We encourage any buyer to seek advice from a solicitor, an architect or independent specialist.”
The penthouse kitchen and four bathrooms would probably be updated along with the exterior remedial work. Photo / File
The apartment has up-close views of Sky City and the Sky Tower. Photo / File
Dunn said while the property wasn’t “super, super high end” compared to new luxury downtown blocks like The Pacifica and Seascape, there were experienced buyers who would be keen to pick up a place like this, spend the remedial money on the building and then modernise the dated kitchen, bathrooms and decor.
“A lot of the time the buyers are people who work in this kind of industry like construction, or they’re investors who buy into remedial sales. The other buyers [for remedial properties] are owners already in the building, who are up to speed with all the meetings and a bit closer to it.”
The advertisement says: “Perfect for a cash buyer who can hold on for the rocky road ahead – there is some serious money to be made here once fixed.
“You’re buying to sell as a better product,” he said.
Dunn said that at this bargain price, in the meantime an investor would do well on rental returns – he estimates the large apartment would get close to $2000 per week – until remediation works start. He added that in some blocks around the city, tenants even remain in place during the building period.
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