Long leases a feature of Waikato Countdowns
Two Waikato Countdown supermarket premises have been placed on the market, each with more than a decade to run on their properties’ leases.
The properties, one located in Huntly and one in Tokoroa, still have more than half of their initial 20-year lease terms remaining to one of New Zealand’s largest grocery suppliers.
The land and buildings of the two supermarkets are being offered for sale individually by tender, closing Thursday December 9, unless sold prior.
‘‘A long lease to one of two big players in the retail grocery market is about as good a bottom drawer investment as you can get in the commercial property market,’’ said Bayleys’ senior broker Mike Houlker.
The Huntly property is the only supermarket in the town, located between Auckland and Hamilton, and services both the township and the surrounding rural areas in all directions, said Houlker, who is marketing the property with Bayleys Auckland colleague Sunil Bhana, and Bayleys Waikato’s Alex ten Hove.
The 3964-sqm building (including canopies) is located on a highprofile 9764sqm site at 16-18 Tumate Mahuta Drive. It also has frontage to State Highway One, which is the main arterial road through Huntly.
The single-level building covers approximately 33 per cent of the site with the balance providing extensive customer car parking.
The property has just over 10 years to run on its initial 20-year lease with rights of renewal totalling 40 years, which would take Countdown’s occupation through until December 2071 if exercised. The property is currently returning net annual rental income of $671,024 plus GST.
The Tokoroa offering encompasses a 2788-sqm supermarket on a prominent 10,532sqm freehold site at 12-20 O’Sullivan Drive. Purpose built for Countdown in 2011, it has just over 11 years to run on its lease with rights of renewal until 2071.
It, too, is located in a highprofile position, just off State Highway One in the heart of central Tokoroa’s retail precinct. This property, returning $636,431 net plus GST per annum, is being marketed by Mike Houlker, Sunil Bhana, and Willem Brown of Bayleys Waikato.
‘‘These two properties represent quintessential defensive real estate offerings with the supermarket sector amongst the most resilient of property investment classes,’’ said Houlker.
‘‘Because of the nondiscretionary, essential nature of grocery shopping, supermarket retail spending generally exhibits low volatility and steady sales figures through different economic or market conditions. This has certainly been reinforced by the sector’s continuing strong performance through various Covid 19 lockdown levels.’’