A strip of four retail premises collectively known as Valley Entrance Shops in the Lower Hutt suburb of Stokes Valley, have been placed on the market for sale with the added drawcard of bare land to the rear of the shops which holds development potential.
As the offering’s name suggests, the property lies close to the entrance to the popular suburb, on the east side of Stokes Valley Road, making the shops a convenient and easy stopping point at the gateway to the suburb’s 10,000 resident population.
The property is in a residential area and has on-street parking for customers.
All four retail shops are of equal size at 82.5sqm and are fully-leased on varying terms – some with rights of renewal.
There is an additional small income stream from leased billboard space at each end of the building, leveraging off the property’s profile to the main access road to the valley.
Paul Cudby and Bhakti Mistry of Bayleys Commercial Wellington are marketing the freehold land and buildings for sale.
“This is an affordable, entry-level commercial investment proposition with the dual appeal of a proven rental yield on the existing retail space coupled with the unrealised potential of unutilised land behind these shops,” explains Cudby.
“The flat, regular-shaped site is 1,006sqm, zoned Suburban Commercial, and the retails units only occupy around a third of the property’s total land area.
“The vacant land is independent to the operation of the businesses and with the wider Lower Hutt area experiencing a well-documented shortage of residential accommodation, there is the opportunity to pursue options with the Council which is currently looking favourably on higher density residential developments.”
Cudby says a proactive developer will be able to go through the necessary Council investigative and planning processes to determine how best to optimise the value of the land behind the retail businesses, while having a regular income from the property thanks to the sitting tenants.
At the end of 2019, the revised three-yearly Quotable Value assessments showed the Stokes Valley residential market had risen 39.8 percent – up on the Lower Hutt-wide average increase of 30.8 percent and making the Valley one of the better-performing suburbs in the catchment area.
Cudby says the property has a “modest rateable value” (RV) of $570,000, effective July 2020 and returns $43,263 per annum net plus GST.
The commercial tenancies have a proven leasing history and Mistry says the current tenants are well-established.
“The line-up covers the bases with a busy dairy, popular takeaway business, and a well-patronised barber shop, along with a successful wholesale artisan bakery business which does not retail from the site,” she says.
“The manageable yet functional size of the retail spaces has meant that historically there’s been very little vacancy in this block of shops.
“There’s also the flexibility of using the space for office use which extends the prospective tenant base.”
Constructed in the 1960s, the building comprises a single storey retail structure partitioned into four retail shops with concrete walls between tenancies.
It is built of reinforced concrete foundations and floor, with concrete block
walls and a steel roof.
Stokes Valley is well-positioned to take advantage of the main arterial Eastern Hutt Road providing easy access to both Lower and Upper Hutt, State Highway 2 and State Highway 58 via the new Haywards interchange. It is around 20 minutes’ drive from Wellington CBD (traffic dependent).
The Suburban Commercial zoning overlay provides for a variety of uses including retail, community facilities, places of assembly, health care services and residential activities. The height limit is eight metres with side and rear yard to abutting residential properties of three and eight metres respectively.