A block of three retail units in the South Auckland neighbourhood of Māngere East has been placed on the market for sale, offering the opportunity for investors to enter a highly sought-after sector of the commercial property market.
461 Massey Rd, which is made up of three shops and a residential flat in a single-level building, is being marketed by CBRE brokers Deborah Dowling and Brett Whalley. It is offered for sale by deadline private treaty closing on Thursday February 13 at 4pm, unless it sells before the deadline.
The freehold property, which has been held by the same owner for many years, offers affordable pricing and multi-tenanted, split-risk characteristics. These factors make it ideal for people looking to buy retail investments, says Dowling.
“Retail property is still immensely popular among investors and this asset is in an entry-level price bracket for the retail market, which is in very high demand. The separate leases will also be viewed as a big plus by those looking for a reduced risk profile.”
The 458sq m building is occupied by three tenants: a superette (which includes the residential flat), Fish World and Four Seasons Takeaways. All are very well established, having occupied the property for over 15 years, Whalley says.
“This block of shops is something of a local icon and has been servicing the large surrounding neighbourhood for over 50 years. The Fish Shop is virtually world famous in South Auckland, with customers travelling far and wide to buy their fresh seafood here.”
Annual net rental income from the three tenancies amounts to $115,310, with all three tenants’ leases having been renewed on October 1 2018 for four-year terms. Rents are also reviewed annually to the CPI index. An additional right of renewal provides all tenants the option to extend their tenancies until September 30 2026, making for an attractive long-term investment, Dowling says.
“This modest property has some strong investment fundamentals in place which we believe will result in high buyer demand, not least the long-term nature of the leases and the fact that the tenants have been trading well here for a long time.”
While the property will be primarily considered a hands-free, passive investment by most buyers, those keen for add-value opportunities also have options available, says Whalley.
“There is surplus land to the rear of the site, which is currently used for parking and storage. This area could potentially be developed under the Business – Neighbourhood Centre zoning rules, which permit residential, commercial or retail developments up to a height of 13 metres.”
The building was constructed in the late 1960s and has been improved and upgraded over the years. The most recent renovations were carried out in 2018 to the Fish Shop’s unit, which was damaged by an internal fire and subsequently renovated to a high standard.
The superette occupies the largest tenancy, with the rear flat featuring three bedrooms, kitchen and living areas. The two other smaller shops have separate amenities at the rear and access to the back carpark and loading areas.
The large freehold site benefits from off-street parking in front of the shops, with the property enjoying a high profile to the more than 19,000 vehicles passing along Massey Rd daily.
It is located just 200 metres east of access ramps to and from the Southwestern Motorway, with bus routes also nearby. The main Māngere East retail precinct is located around 500 metres east of the property and includes a Countdown supermarket, drive-through food outlets, a petrol station and other retail outlets.
The suburb of Māngere East is a well-established location in South Auckland, predominantly made up of residential homes built from the 1950s through to the present day, along with an industrial park in the Tidal Rd area, says Whalley.
“The suburb has benefited from a rise in popularity due to easy motorway access and quicker travel times to the city following the opening of the Waterview Tunnel in 2017. The area also features several schools, parks and public recreation areas.”
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