An educated investment opportunity...

A high-profile, multi-coloured building on a 4046sq m freehold site in Manukau City - tenanted by one of the largest providers of early childhood education in New Zealand - will go to auction with Bayleys on 19 August.

Housing the National Operations office and two licensed childcare facilities for Kidicorp Limited, the building on the corner of Great South Road and Puhinui Road in Manukau is being marketed by Michael Pleciak, Mike Adams and Mark Pittaway of Bayleys.

Kidicorp Limited operates early childhood and after-school care centres throughout New Zealand with facilities in most regions from Auckland to Dunedin. They took an 18 year guaranteed lease on the prominent low-maintenance building in September 2006 and as part of the lease, have undertaken to redecorate the premises in 2012 and again in 2018.

The net rental income is currently $287,663 per annum plus gst with the rent reviewed every two years to the CPI formula and every four years to current market rentals with Kidicorp Ltd responsible for 100 percent of the operating expenses.

“In the current market there’s a shortage of passive investment properties with sound long-term leases in place, so we are expecting significant investor interest in this property, especially given that it has a national head office tenancy,” says Pleciak, adding that the current owner is a private investor who is now wishing to free up some capital to invest in a more hands-on project.

“It is a buyer opportunity likely to appeal to a private individual investor wishing to have the locked-in security of an established and secure lease for the next 15 years. This allows for easier access to funding, the ability to plan and project returns and minimal risk which, for a private investor, is reassuring.”

Zoned Business 5 under the Manukau Council District Plan, the single level buildings were originally built as office and warehouse premises in the early 1980s. Converted by Kidicorp Limited in late 2006 into comprehensive childcare facilities and their national operations base, the floor areas are approximately 1024sq m for the office/childcare facilities and an outdoor activity area of 369sq m.

“There is also parking on-site for 29 cars and double access from either Great South Road or Puhinui Road. This intersection is traffic-light controlled and the property has significant profile to passing traffic, given that they are busy arterial roads,” says Pleciak.

“The site is roughly halfway between Papatoetoe and Manukau centres and this provides a wide catchment area for early childcare and after-school care services enhancing the viability of a business such as Kidicorp. Manukau is New Zealand’s third largest city and the fastest growing with 26 percent of the population aged under-15 years according to the 2006 Census figures.”

With motorway connections nearby – approximately 800 metres to the south at the Te Irirangi Drive on ramp and 2.2 kilometres north at the East Tamaki on ramp – the site is well-located for commuting parents to drop off and collect children.

Great South Road, Manukau is a sought-after business area with a mix of land uses including retail, commercial, service providers and the AUT Manukau Campus located on the former Carter Holt Harvey site on the corner of Te Irirangi Drive and Great South Road.