Brand-new Tokoroa building

The newest commercial building in the South Waikato town of Tokoroa is for sale, with two committed government tenants on long leases making it a low-risk passive opportunity for an investor seeking a well-performing provincial asset.

The two-level A-grade building on circa-1,011sqm of freehold land at 30 Logan Street, just off State Highway 1, is centrally positioned within Tokoroa’s established commercial precinct, benefiting from proximity to key civic services, retail amenities and arterial transport routes.

The property was purpose-built by Henley & Haus, and is fully-leased. The Ministry of Social Development (MSD) occupies the 641sqm plus courtyard ground floor tenancy, and Oranga Tamariki is located on the 713sqm first floor which has a balcony. Each floor has kitchen and bathroom amenities, with a lift and stairwell providing access to the upper level, and there is sealed carparking at either end of the building.

The brand-new building was officially opened late-November last year and has passing annual net rental of $496,386 plus GST. MSD has an initial 12-year lease term, and Oranga Tamariki, nine years, with both leases having three further three-year rights of renewal, along with scheduled rent reviews to CPI and market.

Logan Street stretches the length of the Tokoroa CBD, connecting the retail precinct with the commercial zone. The subject site was formerly used as carparking, and is directly opposite the Tokoroa Police Station, and the Raukawa Charitable Trust headquarters. Neighbouring businesses include BP Connect, Mayfair Hotel, St Johns Ambulance, Farmlands, Railside Storage, and New World.

Ryan Bradley, Brendon Bradley, and Duncan Hancock of Bayleys have been appointed to sell the property by deadline private treaty closing Thursday 12th March, unless sold prior.

With both government agencies having searched for a new base in Tokoroa for some years, Ryan Bradley says the purpose-built property will future-proof their operations and provide certainty for a new owner of the property.

“This is a flagship building for Tokoroa, and the weighty first term leases show commitment to the site by the two agencies, with MSD saying at the time of their move to the new service centre, that the space meshed with their priorities for private, secure and welcoming premises for their clients.

“As an investment proposition, the property delivers strong income security underpinned by long-term public demand for the services the tenant agencies provide.”

Bradley expects enquiry and interest from investors actively scoping regional commercial assets to add to, and diversify, an existing portfolio.

“We anticipate that the building will be a generational government-leased building given New Zealand’s proud, long-standing commitment to social services since the Social Securities Act in 1938.

“Investors looking for a very low-risk, long-term passive asset will recognise the value inherent in this new-build property.

“The modern construction profile significantly reduces future capital expenditure requirements, while the functional layout is well-suited to ongoing office use.”