|Investment Property Snapshot|
|What: 140 sqm retail space in a character building opposite Auckland Art Gallery.|
|Where: Units B & C, 28-36 Wellesley St, Auckland CBD.|
|Sold for: $1.25 million|
|Net rental yield: 5.44%|
The area around the corner of Kitchener and Wellesley Streets in Auckland's CBD is known as the arts precinct, with Auckland Art Gallery, a sprinkling of dealer galleries, Auckland Public Library and several performance venues all nearby.
But it's also an area that's undergone some significant changes with many of its retail premises catering to students at the nearby universities and a younger Asian crowd.
Although its street address was Wellesley St, it was located at the back of the building, on the corner of Kitchener St and Khartoum Place which runs between Kitchener and Lorne Streets and was directly across the road from Auckland Art Gallery and Albert Park.
On the ground floor of a character building with upmarket apartments on the upper floors, it was operated as a photographic gallery with its own kitchenette, toilets and storage space, on a lease which runs until at least November 2021.
It was returning $68,000 a year in net rental income.
Gow said although the property had a lot going for it, the fact it was in an older building with relatively high operating expenses would have weighed on the minds of some investors, although it appealed to a wide range of potential buyers.
Some were keen on the idea of converting it into an apartment, others were so-called mum and dad investors who had been turned off residential investment property by the high prices and low rental yields in Auckland. There were also mainstream commercial property investors.
In the end it was purchased for $1.25 million by an overseas investor who had other interests associated with the art scene.
At that price the new owner will receive a net rental yield of 5.44%.
Check out our Commercial Property Sales page for details of other commercial sales from around the country.
You can receive all of our property articles automatically by subscribing to our free email Property Newsletter. This will deliver all of our property-related articles, including auction results and interest rate updates, directly to your in-box 3-5 times a week. We don't share your details with third parties and you can unsubscribe at any time. To subscribe just click on this link, scroll down to "Property email newsletter" and enter your email address.