Tokoroa building seen as bargain

Could this be the biggest commercial property bargain in New Zealand?

The Tokoroa building is called Grayburn House, which has a rateable value of $1.7 million and sold for $550,000 last month.

The buyer is understood to be Tokoroa man Walter Pelican, who already owns more than 40 properties in the area.

Wellington commercial real estate agency Tommy’s Commercial marketed the property and agency director Chris Gollins thought it could prove to be the cheapest office building in New Zealand.

‘‘At $294 a square metre for land and building it’s probably been purchased at less than a 10th of its replacement cost,’’ he said.

‘‘And it’s actually a very good building, substantially of concrete with concrete floors.

‘‘It was completely neglected but I understand the new owner is already refurbishing it.’’

Gollins said the vendor, Palmerston North property development company Valor Ideal, had commissioned Tommy’s Commercial to sell the property in July after spending more than five years trying to float various tenancy and development proposals.

The property’s settlement occurred before Valor Ideal was placed in liquidation last month.

Grayburn House is a two-storey building on a 3300sqm site adjacent to State Highway 1 and the Tokoroa town centre.

It was built in 1984 as a government building and was upgraded in the 1990s when Carter Holt Harvey leased it and converted the site into its Tokoroa administration centre.