An office tower occupied by global dairy giant Fonterra with development upside in New Zealand’s fastest-growing metropolitan area has investors eyeing the ‘big cheese’ opportunity.
A tenanted office tower on a prominent corner in Hamilton’s Central Business District is attracting strong interest from investors amid appetites for well-located premises that safeguard value with flexible use options.
The extensively refurbished 6,791sq m (more or less) of lettable refurbished office at 78 and 80 London Street is in a prime position to leverage high-profile visibility, attracting maximum exposure from passing foot traffic and vehicle movements.
Bayleys executive director David Bayley says the property is a class-leading asset in New Zealand’s fastest-growing metropolitan area, which presents an inimitable opportunity for investors to maximise superb geographic fundamentals.
“Whilst currently occupied by global dairy giant Fonterra, there is scope for diverse use options, including a hotel, apartment conversion or continued use as a trophy office asset,” he says.
“Strong international visitation and the rebound of the tourism sector continues to be a bright spot for New Zealand’s economy. At the same time, projections see housing supply is not meeting demand due to escalating population growth, which presents development firms and investors with an opportunity to provide solutions.
“Funders continue to emphasise the role of quality and diversification for assets on their books, which informs investor appetites, particularly as the flight to quality narrative drives consumer demand as an entrenched market feature.”
Mr Bayley is marketing the premises for sale by tender, closing at 4:00 pm on Thursday, 26th October 2023 (unless sold prior) with colleagues David Cashmore, Alex ten Hove and Luke ten Hove.
Bayleys Hamilton commercial manager David Cashmore says the property currently returns $1,799,064.31 net per annum plus GST and outgoings from a lease to global dairy giant Fonterra.
“Fonterra has a lease due for renewal in September 2026 for a further term of 3 years.
“This feature provides an opportunity for renegotiation of lease terms or an ideal development timeframe for firms to complete plans whilst collecting income from one of the world’s largest dairy companies,” he says.
The total land parcel comprises 5,302sq m (more or less), held in five titles zoned Central City – Precinct 1 (Downtown Precinct) - which features the most significant mixed-use development capability under local council rules.
Bayleys Hamilton salesperson Alex ten Hove says internal refurbishments were completed in 2016, providing a solid foundation for future add-value works.
“Set on 4,184sq m (more or less), Fonterra House is located at 78-80 London Street and features a prominent high-rise tower and on-grade car parking.
“Also included in the sale is 1,118sqm (more or less) of accompanying land adjacent to the eight-level office tower at 9-11 Harwood Street, which provides for a further 48 car parks.”
The parcel is positioned in the heart of Hamilton’s CBD, benefitting from proximity to major highway interchanges, public transportation routes and a dynamic mix of commercial and residential development.
Bayleys Hamilton salesperson Alex ten Hove says the properties are a secure, long-term investment in the heart of a thriving precinct, which inherently provides promising upside from rental growth and development options.
“Hamilton’s CBD is a sought-after investment destination given a scarcity of quality, well-located and modern premises. This is underpinned by strong tenant demand and an appetite for commercial accommodation and housing.
“Seismically compliant buildings, well-located relative to central amenities, are also perennially in demand. We expect this class-leading asset will generate strong attention from investors both within New Zealand and abroad,” Mr ten Hove says.