A fully-tenanted retail offering in Bridge Street, Nelson is on the market with a much-reduced price as a once-only offer and $270,000 below the property’s current rateable value.
The properties at 82 and 84 Bridge Street occupy 435sqm of Inner-City Centre-zoned land over two freehold titles, with frontages to both Bridge Street and Buxton Square.
Just 70 metres east of Trafalgar Street – the main shopping strip – and with a favourable northern aspect to Bridge Street, there are four fully-leased individual retail tenancies returning a net annual income of $97,795 plus GST and operating expenses.
With a collective asking price of $1,220,000 + GST (if any) and the existing tenant covenant, the properties provide for an 8-percent return on investment.
The anchor tenant is sports’ footwear retailer Shoe Clinic which has operated from the site for 14 years and has a new six-year lease from 1st November 2019 with rights of renewal in place.
The other businesses are e-bike seller Electrify NZ Nelson which is part of a nine-store nationwide network, massage therapy providers Nelson Relax Thai Massage, and beauty service operator, Alibi Hair and Beauty Room – all on varying lease terms and with rights of renewal.
Shoe Clinic and Electrify NZ front onto Bridge Street and are directly opposite Warehouse Stationery and adjacent to Noel Leeming. Nelson Relax Thai Massage and Alibi Hair and Beauty Room are accessed from Buxton Square, which has ample public car parking, or on foot via Fiddle Lane which runs off Bridge Street just along from Shoe Clinic.
Paul Vining of Bayleys Nelson says the owner of the properties is a private local investor who has made improvements to the buildings which are at 67 percent NBS, negotiated new leases for the tenants and is now looking to realign his asset portfolio.
“This is a split-risk investment with a good spread of tenants – all of which are well-positioned to service the local market as consumer spending resumes after the COVID-19 lockdown restrictions,” says Vining.
“With New Zealanders being encouraged to shop local and support local businesses in the current economic climate, these businesses are able to provide equipment and services in both the leisure and well-being markets which are both enjoying solid demand at present as Nelson residents start to spread their social wings again.”
Vining says the retail property sector had been “a bit challenging” in pre-COVID times right around the country, but he expects that there will be an emotional component in property investment in the foreseeable future.
“I think there’s been a shift in thinking as everyone has been forced to take a breather and reassess priorities,” says Vining.
“The community spirit and cohesiveness that we’ve seen in Nelson over the lockdown period and subsequent moving down through alert levels has been awesome.
“Nelsonians have a new appreciation for this part of the world and may well look to invest in the city’s commercial property stock.
“I also sense that former residents could experience an emotional pull back to the region as they reassess their futures and Nelson could be seen as an attractive place to invest.”
With a combined rateable value today of $1,490,000, the asking price for the properties of $1,220,000 plus GST if any, is only just above the 2009/2010 rateable value, creating a tangible opportunity for an investor to either get into the commercial market or add to an existing portfolio.
Vining says Nelson City Council is supportive of local businesses and keen to see the city centre thrive.
At a recent extraordinary meeting, city councillors showed commitment to supporting the community through the COVID-19 crisis by voting unanimously to consider a zero percent rates rise in the 2020/21 Annual Plan.
In the same meeting, Council agreed to a comprehensive relief package designed to aid Nelson’s recovery from the COVID-19 shutdown which includes the suspension of all parking fees in the city centre until the end of June 2020.
Nelson-Tasman’s economy is largely dependent on seafood processing, forestry processing and other manufacturing strands and it is expected that this will stand the region in good stead as it navigates the post-COVID economic landscape.