Developers Eye Site’s Mixed Blessings On Auckland’s Flourishing CBD Fringe

A freehold site zoned for intensive redevelopment has gone up for sale with residential holding income in a sought-after mixed-use enclave on the edge of Auckland’s CBD.

Located just to the south of the city centre, the property for sale at 12 Karaka Street, Newton, boasts a north-facing, elevated corner position with multiple road frontages.

It sits in a precinct which has become a hotspot for residential and mixed-use development projects. Forming part of the flexible and intensive Business – Mixed Use zone, with a higher-than-usual allowable building height of up to 32.5 metres, the Karaka Street site is considered ripe for multistorey development.

An existing two-storey residential building on the site is fully leased, generating gross rental income of $131,000 per annum.

The freehold land and building at 12 Karaka Street, Newton, Auckland, are now being marketed for sale by tender closing on Tuesday 8 March (unless sold prior), through Bayleys Auckland Central.

Salespeople Alan Haydock and Damien Bullick said the property consisted of a two-level building of approximately 306 square metres with 9 car parks on some 472 square metres of freehold land.

Constructed in the early 1990s, the building contains two self-contained flats. The ground-floor unit of 153 square metres has seven bedrooms, with four dedicated car parks, and generates gross annual rental income of $65,000.

A second 153-square metre unit on level one offers six bedrooms and 5 car parks, returning gross income of $66,040 per annum.

“These stable income streams will provide an excellent cashflow while a new owner plans developments or, alternatively, an ongoing income for investors and/or land bankers,” said Haydock.

“Intensive-zoned sites in this precinct are becoming tightly-held for good reason.”

Haydock said the prized Business – Mixed Use zoning under the Auckland Unitary Plan, which allows for intensive residential, commercial or mixed-use development, was facilitating an ongoing transformation of the southern CBD fringe.

As well as residential projects, the zone’s permitted activities include offices, food and beverage, retail and healthcare.

“As a result, Newton and Eden Terrace have rapidly evolved into flourishing mixed-use precincts on the edge of the CBD, driven by ongoing intensification with residential and commercial developments as clearly evidenced by the neighbouring development, 59 France.”

Bullick said the Karaka Street site had the added advantage of an allowable building height of up to 32.5 metres, more than 14 metres higher than the 18 metres usually allowed in the Business – Mixed Use zone.

“Future owners or developers of the Karaka Street site will also benefit from its strategic and highly convenient location.

“A short stroll from Karangahape Road and its future City Rail Link station, the property offers easy access to transport links and the CBD, along with entertainment and amenity hubs such as Mt Eden, Ponsonby and Newmarket,” said Bullick.

A new CRL station at Karangahape Road with an entrance on Mercury Lane is expected to further stimulate commercial real estate activity in the area, which is considered by many to be underdeveloped given its central location.

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