Mega sale of $20million property

One of New Zealand’s largest bulk retail properties – the massive 14,187 square metre Mitre 10 MEGA store in Henderson, West Auckland – has sold for $20 million.

The sale post auction to a private Auckland investor was negotiated by Scott Kirk of Bayleys Auckland and Darryl Devereux and Brian Caldwell of Bayleys North Shore at a yield of 9 percent on the property’s net annual rental income of approximately $1.8 million. Mitre 10 (New Zealand) Ltd has a 10-year head lease on the property from April 2009.

Kirk says the Lincoln Road building was the largest bulk retail outlet of its kind in Australasia when it was completed in 2004 – and still ranks well up the scale because of its sheer floor space. It comes with 8667 square metres of general retail space, a 2467 square metre garden centre, offices and amenities, a 1036 square metre timber yard and a cafe.

Devereux says a previous sales contract on the property had fallen over because the prospective investor could not secure the necessary funding.

“There is still strong investor demand for well located buildings leased long-term to a major national retailer, with high net worth individuals and private companies looking for these sorts of opportunities even at this price level.”

The store sits on the southern end of a 2.76 hectare site next to one of the country’s biggest Pak n’ Save stores and a Shell petrol station, with extensive customer car parking for 261 vehicles. The high profile site is strategically located in Lincoln Road, one of West Auckland’s major arterial routes, which has a daily traffic count of approximately 47,250 vehicles.

Kirk says the area is a natural drawcard for business investment because of its high profile exposure, and has become an extremely sought after retail location in recent years – as evidenced by the sell down of all 22 commercial properties in the nearby Lincoln North shopping complex in July.

The Mitre 10 Henderson property was sold by family interests of Auckland businessman Vinod Kumar, whose company Magsons Hardware Ltd subleases the property from Mitre 10 (New Zealand) Ltd. Kumar’s company also owns two other Mitre 10 businesses - in Botany and Westgate.

Since Mitre 10 Mega format was introduced in 2004, it has grown remarkably with 22 Mega stores currently trading and a further 15 new Mega stores to be opened within the next two years.