Compelling terms for A-grade Whangārei building

The commercial property housing ASB bank’s Whangārei branch and Northland regional centre is for sale, with a long-term lease in place, making it a desirable “set-and-forget” investment asset.

The two-level modern A-grade building was purpose built for ASB by Wallace Development Company in 2017, with the bank consolidating its presence in the premises in early 2018.

The 815sqm building is located on a freehold 875sqm site with City Centre zoning close to key amenities at 5 Rathbone Street in a high foot traffic CBD precinct, with Butter Factory Lane, primarily a business service lane, running down one side.

The well-presented property comprises 235sqm ground floor retail banking space, 111sqm ground floor offices, 407sqm first floor office space and meeting rooms for ASB retail, commercial, wealth and insurance, and rural banking teams, plus six covered car parks.

Fully leased to ASB Bank Limited, the current lease runs through to 22 November 2032, with rent reviews every two years ensuring growth potential, and a further five-year right of renewal with final lease expiry in 2037.

The property is for sale by deadline private treaty, closing Thursday 11th December, through Nigel Ingham, James Hill, and Sunil Bhana of Bayleys.

The private investor owners are ready to sell, says Ingham, who predicts strong interest in the offering given improving market fundamentals.

“With the blue-chip tenant ASB having a solid lease providing income security, this property will suit investors chasing certainty around lease terms and tenant covenant and scouting for low-capex buildings for passive ownership.

“This near-new asset is a box ticker on all counts and stands out in the Whangārei market, where many competing buildings are older and require ongoing capital expenditure.

“This property quite literally has a bankable tenant covenant and can be viewed as a defensive asset for hands-off investors.”

Ingham says there’s been a noticeable lift in investor enquiry in recent months, driven by several factors.

“According to OneRoof, the volume of interest originating out of Auckland for real estate opportunities in Whangarei is the highest it’s ever been.

“I believe this stems from government investment and green light for Roads of National Significance, the expansion of Northport with a proposed wharf extension and new container terminal, and wider infrastructure commitments.

“Business confidence is improving as long-term regional growth in Northland becomes more predictable. The rural economy is also buoyant, with record dairy and beef payouts, and the forthcoming Fonterra-Lactalis deal fuelling investment diversification towards commercial property assets.”

James Hill who is based in Bayleys South Auckland office says enquiry from Auckland-based investors for regional commercial assets is robust, with clients chasing returns in growth locations.

“Markets such as Whangārei are appealing given the ease of access and the cost-effectiveness of assets compared to metropolitan centres.

“Occupiers are seeking out quality, modern, efficient buildings in good locations. With Whangārei just a couple of hours’ drive from central Auckland, the ASB building has everything that astute investors are looking for.”