CBD apartment block management contract on the market for sale
The property management business overseeing one of Auckland’s biggest residential apartment blocks has been placed on the market for sale.
Pace Property Management is responsible for running 104 residential units within the Scene Three Apartments complex in downtown Auckland’s Beach Road. All of the units are on long-term rental leases, and have an exclusive management agreement locking them in to Pace’s services.
The company is responsible for collecting rent, paying building service charges such as water, rates, ground rent, and body corporate fees, the disbursement of rentals to unit owners, and letting any vacant units.
The Pace Property Management business is being marketed for sale by Bayleys Real Estate through expressions of interest closing on December 3 through business brokers Paul Dixon and John Greenwood.
Mr Dixon said the business could be bought as either a stand-alone commercial entity or could be integrated into an existing property management agency with processes and systems already in place.
“From a stand-alone perspective, the business would obviously suit someone with a broad mix of business skills – such as financial administration, project management, and some degree of customer service skills – and obviously with property management expertise as a cornerstone,’ Mr Dixon said.
“Ideally, the new ownership model could suit a husband and wife type operation encapsulating two partners with complimentary skill sets – such as one running the physical asset management side of the business, and one focused on the back-of-house and administrative aspects of the venture.
“For those entering the property management sector, this business with its already large tenancy portfolio could be viewed as the starting point for a bigger operation based in a fast-growing part of the city-fringe apartment market – with existing neighbouring apartment blocks, and more being developed up the nearby Anzac Ave and Symonds Street spine.”
The Pace Property Management business is being sold with a leasehold on-site manager’s 156 square metre apartment on the first floor of Scene Three, and a separate 12 square metre freehold office on the second level of the block.
Full financial management and accounting software systems come with the business. Neither the manager’s accommodation unit nor the office come with any car parks within Scene Three, although these can be rented from tenants within the condominium.
The Scene Three apartment block is 16 storeys high and contains 164 individual apartments in a mix of studio, one, two, and three-bedroom configurations. The apartment tower was built in 2003, and has 59 owner/occupier residents living there.
Building maintenance in communal areas such as the swimming pool and surrounds is paid by annual operating levies collected from all the individual owners. Conversely, individual apartment maintenance and repairs are funded through the deduction of remedial costs from collected rent specific to the unit having the work undertaken.
Mr Greenwood said Pace Property Management had the opportunity to grow its revenue stream through the provision of personalised ‘concierge’ services such as those available through high-end serviced apartments.
“Those concierge services generally involve the personal management of the lives of residents within the apartment block. This could range from organising the collection and delivery of their dry cleaning or purchasing their grocery supplies and stocking the kitchen cupboards, through to overseeing mobile mechanic car repairs and coordinating residents’ social activities,” Mr Greenwood said.
“For a professional concierge it’s all about customer-service. Importantly, the potential customer base for any concierge service actually includes all residents within the Scene Three Tower – not just those on lease contracts.
“In a trust-based relationship built up over the years, those property management services could even stretch as far as project supervising the redecoration or refurbishment of rental units either between tenancies, or in preparation for sale.”
With a Countdown supermarket next door, the Britomart hospitality hub just a few hundred metres away, and CBD Auckland within less than a kilometre, Mr Greenwood said Scene Three apartments had an occupancy rate of close to 100 percent.