McGregor says: “44 Taharoto Road presents an exceptional opportunity to acquire a landmark Auckland office asset on over one hectare of prime land, underpinned by a strong, long term lease to a New Zealand Government-backed public healthcare provider with various land development options in the near future.”
The 15-year lease over the main office building incorporates fixed rental steps producing an attractive income growth profile, whilst the carparks and buildings on the balance of the property are on a shorter four-year lease and ultimately will suit more intensive residential or commercial redevelopment in the medium term.
A property of this size, quality and tenant covenant, when combined with its strong underlying land value and strategic location, represents an outstanding investment and development opportunity that will appeal to buyers in New Zealand and overseas.
Occupying a 10,619sqm site (approximately 1.06 hectares) are three buildings with a total net lettable area (NLA) of 5,522sqm.
The main building, Waimarie House is a five-level office building with 3,606.29sqm of NLA. The second building, Health Alliance House has a total net lettable area of 1,400.17sqm over two levels, and the rear building consist of a single level office with a total net lettable area of 515.54sqm subdivided into eight units.
The buildings have NBS seismic ratings of 70% and 80% respectively.
Extensive car parking is provided on site for 248 cars, with multiple entry points.
John Holmes says that the property offers current stable long-term income underpinned by exceptional leases. “The buildings on the property are fully occupied by the Waitemata District Health Board (WDHB), a New Zealand Government-backed public health care provider, with a Weighted Average Lease Term of 10 years. The property returns over $2 million per annum, with fixed rental growth at 2.5% annually.”
Employing more than 6,800 people in more than 30 different locations throughout the districts of Rodney, North Shore and Waitakere in Auckland, the WDHB provides hospital and community services to the region.
“District Health Boards are directly funded by the New Zealand Government and are provided with an annual budget of approximately $1.4 billion, mainly from the Ministry of Health,” says Holmes. “With more than 630,000 people living in the district, the WDHB has the largest - and second fastest growing - population among all district health boards in New Zealand.”
The predominantly Business Mixed Use-zoned site has a high land value component, which gives it future development potential, says John Holmes. “The rear portion of the site in particular presents significant redevelopment potential. To that end, advice has been sought with respect to potential subdivision of the existing land holding, and two potential subdivision options offer potential.”
On a main arterial road leading into the seaside town centre of Takapuna, 44 Taharoto Road is located close to Auckland’s Northern Motorway, Smales Farm Business Park and North Shore Hospital; 9km from Auckland City and 28km from Auckland International Airport.
The property is surrounded by other office and medical businesses as well as high-density housing.
Deborah Dowling says that over recent years CBRE has seen office and retail demand in Takapuna outstrip supply, leaving vacancy rates at an all-time low.
“Office rentals are expected to continue to grow on the back of exceptionally low vacancy rates for prime office space in Takapuna. There are a number of drivers behind why Takapuna is noted as one of Auckland’s most desirable suburban town centres and is the business hub for the North Shore. A strong driver of Takapuna’s success is the local business association, which advocates for local business and has driven a number of redevelopment projects and initiatives over the years.”
Dowling adds that Auckland Council is also committed to Takapuna’s growth. “The Unitary Plan earmarks Takapuna for priority investment over the next ten years, anticipating that today’s population of 8,000 workers and 3,200residents is expected to increase to 15,000 workers and 15,000 residents by 2040. Over 100,000 people currently live within a 4.5km radius of the central metro area. Furthermore, Panuku Development Auckland is seeking to further retail and residential development on the large car park lot on Anzac Street to intensify the population in the area.
“These factors, combined with the size and high-profile nature of 44 Taharoto Road, its long-term lease to the Waitemata District Health Board and strong development potential, present an exceptional investment opportunity that will attract considerable investor interest.”
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CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2017 revenue). The company has more than 80,000 employees (excluding affiliates), and serves real estate investors and occupiers through approximately 450 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com..