180-182 Gorge Road - Information Memorandum

180 - 182 Gorge Road | Queenstown Information Memorandum For Sale by Negotiation

Accelerating success.

Introduction Colliers have been appointed exclusively to market for sale 180-182 Gorge Road, Queenstown.

This property is being offered For Sale

by Negotiation.

This information Memorandum provides preliminary information to assist interested parties with their assessment of the property. Further information is available via an online data room available on request. colliersotago.co.nz/67025955 Data room link: propertyfiles.co.nz/ property/180-182GorgeRoad

Data room documents available: • Information Memorandum • Certificate of Title and Interests • Proposed Title Plan following Boundary Adjustment • Lease Documentation • Land Information Memorandum • Seismic Assessment – Sullivan Hall Report dated 12 April 2023 • Planning Assessment – Clark Fortune McDonald & Associates Report dated 25 May 2023 • Draft Sale & Purchase Agreement All enquiries, requests for information and arrangements to undertake inspections in relation to this opportunity are to be directed to the sole agents.

Rory O’Donnell +64 27 445 3982 rory.odonnell@colliers.com Mary-Jo Hudson +64 21 667 880 maryjo.hudson@colliers.com

Contents

Executive Summary

2

Investment Highlights

6

The Buildings

8

Tenancy Schedule

9

Location

10

Zoning

11

Queenstown Market

12

Proposed New Title Plans

16

Existing Title

18

Due Diligence

21

180-182 GORGE ROAD QUEENSTOWN

180 Gorge Road, Queenstown

DESCRIPTION

180 Gorge Road comprises a small storage warehouse leased to Rexel New Zealand Limited (Ideal Electrical) with a total floor area of circa 61.09sqm.

TENURE

Freehold

LEGAL DESCRIPTION

Proposed Lot 2 being a proposed boundary adjustment of Lot 4 & 5 Deposited Plan 503215 (refer attached proposed plan)

CERTIFICATE OF TITLE

New title to be issued

LAND AREA

1,235m² (subject to final survey and issue of new title)

FLOOR AREA

61.09m²

LOCAL AUTHORITY

Queenstown Lakes District Council (QLDC)

ZONING

Business

RATEABLE VALUE (as at 1 Sep 2021)

Capital Value - $1,570,000

OCCUPANCY

Rexel New Zealand Ltd

CONTRACT RENT

$14,507 p.a plus OPEX & GST

Land Value - $1,570,000

2

180-182 GORGE ROAD QUEENSTOWN

Boundary lines are indicative only

3

180-182 GORGE ROAD QUEENSTOWN

182 Gorge Road, Queenstown

DESCRIPTION

182 Gorge Road comprises a Showroom/Warehouse leased to Rexel New Zealand Limited (Ideal Electrical) with a total floor area of circa 493.8sqm; plus a first floor office with separate access leased to Outback New Zealand Limited (Outback).

TENURE

Freehold

LEGAL DESCRIPTION

Lot 6 DP 503215

CERTIFICATE OF TITLE

OT755236

LAND AREA

1,520m² (more or less)

FLOOR AREA

493.8m²

LOCAL AUTHORITY

Queenstown Lakes District Council (QLDC)

ZONING

Business

RATEABLE VALUE (as at 1 Sep 2021)

OCCUPANCY CONTRACT RENT

Capital Value - $2,650,000 Land Value - $1,650,000 Improvement Value - $1,000,000 Rexel New Zealand Ltd Outback New Zealand Limited $134,018 p.a plus OPEX & GST

4

180-182 GORGE ROAD QUEENSTOWN

Boundary lines are indicative only

5

Investment Highlights

Owner-Occupier Opportunity

Gorge Road Frontage

With a short, expiring lease in place, there are options for owner-occupiers to purchase this property for themselves.

Road profile and frontage to Gorge Road

Close Proximity to CBD

Fully Leased

Well located within Queenstown’s original Industrial subdivision just 5 minutes from the CBD

Fully leased to Rexel New Zealand Ltd and Outback New Zealand Limited

Development Opportunity

Sizable Area

Two existing freehold titles with low site coverage providing options to enhance the current buildings or develop the site further.

Proposed combined land area 2,755m² (subject to final survey and issue of new title) Floor Area 554.89m² (subject to measure)

6

location indicative only

The Buildings 180 Gorge Road The property comprises a typical Total Span warehouse building leased to Rexel New Zealand Ltd (trading as Ideal Electrical) with a total floor area of circa 61.09sqm.

Construction comprises predominantly of a concrete floor slab supporting steel structural walls and roof clad with coloursteel. Access is provided via two 4.7m high roller doors plus a side door entrance.

182 Gorge Road The property comprises a two level commercial building comprising industrial warehouse/ showroom space on the ground floor leased to Rexel New Zealand Ltd (trading as Ideal Electrical) and first floor office space leased to tourism operator Outback New Zealand Limited.

The total floor area is circa 493.8sqm.

Construction comprises predominantly of a concrete floor slab supporting reinforced concrete walls to the ground floor and a suspended concrete first floor. The ground floor frontage to Gorge Road and the first floor comprises steel and timber structural elements clad predominantly with corrugated colorsteel with areas of fibre cement board, plaster and cedar together with a corrugated colorsteel roof. There is predominantly Aluminium joinery throughout with interior linings painted gib-board walls and ceilings. Layout at the ground floor provides an a large showroom area with associated office and amenities and an adjoining warehouse storage area while the first floor comprises open plan offices with associated amenity areas.

8

Tenancy Schedule Address

180 Gorge Road

182 Gorge Road (Tenant 1)

182 Gorge Road (Tenant 2)

Tenant

Rexel New Zealand Ltd

Rexel New Zealand Ltd

Outback New Zealand Ltd

Tenancy Net Lettable Area (sqm)*

61.09

329.40

164.40

Current Term Expiry

8-Jun-25

8-Jun-25

8-Jun-25

Rights of Renewal

nil

nil

nil

Final Expiry

8-Jun-25

8-Jun-25

30-Sep-24

Next Rent Review Date

N/A

N/A

1-Oct-24

Current Passing Rent **

$14,507 pa

$104,018 pa

$30,000 pa

Building included as part of the Rexel lease for 182 Gorge Rd. Market reviews every 2 years.

15 Sept 2017 Variation of lease added the shed at 180 Gorge Rd. Market reviews every 2 years.

6 months’ termination notice in lease.

Comments

Note - Passing Rent is the current contract rent for the property per lease. * Approximate Net Lettable Area only. ** Rent excludes OPEX & GST.

9

location indicative only

Location 180 - 182 Gorge Road is located on an irregular shaped site with wide frontage to Gorge Road a main arterial route providing access into and out of Central Queenstown.

Gorge Road is the key commuting arterial route between Queenstown’s CBD and Queenstown’s business/industrial zones as well as providing direct access to Arthurs Point, Coronet Peak ski area and Arrowtown. A full range of amenities are available in the Queenstown Town Centre located 1.5km to the southwest and the growing Frankton retail hub located 10 km to the east which includes Five Mile, Queenstown Central and Remarkables Park shopping centres. Also located at Frankton is the Queenstown International Airport.

Surrounding development in the immediate area comprises predominantly other commercial activities including retail, automotive, hospitality, professional services, service stations and visitor accommodation. Outside of this commercial precinct the predominant surrounding use is residential.

As one of the most popular tourist destinations in New Zealand, Queenstown and the surrounding southern lakes has over 2,700,000 visitors (pre-covid) each year, with over half arriving through the Queenstown International Airport. The Queenstown urban population is currently estimated at 35,000, however the average day population (Pre Covid), accounting for the tourist, is estimated at over 40,000.

10

Zoning Under the Operative District Plan (ODP) the subject property is zoned Business. Under the Proposed District Plan (PDP) the majority of properties along Gorge Road that were zoned Business under the ODP are now shown as Business Mixed Use zone under the PDP. The subject property is still under review due concerns from the QLDC in relation to potential natural hazards. Therefore the QLDC did not formally adopt the Business Mixed Use zone over the subject property until further investigations have been completed which are still ongoing and not finalised at this point. (Refer to the Clark Fortune McDonald report in the dataroom).

Some of the key Zone and Site Standards for the Business Zone include: •

Maximum building coverage 75%

•

Maximum building height 7m

•

Minimum lot size for subdivision is 200sqm

•

Road Boundary setback is 6m

* location indicative only

11

Queenstown Market Construction and Tourism continues to underpin business growth and confidence for occupiers of industrial and commercial property.

Critical shortage of land available for industrial development. Currently industrial and commercial property has the lowest vacancy rate on record.

Shortage of industrial property for lease, and the high cost of construction of new buildings, resulting in rent increases. Increases in land values expected to continue due to lack of supply in immediate area.

Queenstown industrial yields from 2018 through covid into 2022 have generally ranged between 4% – 5.0%, with the lower end of the range for the Frankton Flats; and the higher end of this range for the Industrial Place/Gorge Rd industrial area. However, over the last 12 months the market has had to absorb a significant rise in interest rates as the Reserve Bank responds to rising inflation. Queenstown, whilst not totally immune has remained relatively resilient compared to other parts of New Zealand, however we are now seeing yields starting to push out by 0.5% – 0.75% above previous levels.

The viability of new commercial and industrial properties is being challenged by increasing development costs, however long term the ongoing population and tourism growth projections will result in a continued demand for commercial and industrial space that will put pressure on rentals to rise.

boundary lines indicative only

180-182 GORGE ROAD QUEENSTOWN

Proposed New Title Plans 180 Gorge Road

16

180-182 GORGE ROAD QUEENSTOWN

Boundary Adjustment Summary The existing title plan for the subject property (Lot 5, DP 503215) includes a Right of Way (ROW) easement over both Lot 5 and the adjoining property (Lot 4, DP 503215). This ROW easement is marked ‘Area A’ on the existing title plan for the subject property. The Vendor has agreed, together with the Tenants of Lot 4 and 5, to remove the ROW Easement marked ‘Area A’.

The replacement Lot plan, following this boundary adjustment, is included in this Information Memorandum which shows a revised land area of 1235m² for Lot 2 (formerly Lot 5 and share of ROW easement ‘Area A’). The application for this boundary adjustment has been filed with Queenstown Lakes District Council and completion is a settlement condition for the subject property. The benefit to Lot 5 of removing the ‘Area A’ easement, means a reduction in land area from 1426m² down to 1235m² however, this outcome whilst reducing the land area provides a higher usable land area once the easement is removed.

17

180-182 GORGE ROAD QUEENSTOWN

Existing Title 182 Gorge Road

RECORD OF TITLE UNDER LAND TRANSFER ACT 2017 FREEHOLD Search Copy

755236 Land Registration District Otago Identifier

Date Issued

24 July 2018

Prior References 614663 Estate Area Legal Description

Fee Simple 1520 square metres more or less Lot 6 Deposited Plan 503215

Registered Owners Revell William Buckham, Victoria Mary Buckham and Ernest Bruce Morris as to a 1/3 share Jeffrey Robert Williams, Nicola Wendy Martin and BCO Trustees 2011 Limited as to a 1/3 share Henricus Leendert Steven Hoogvliet, Anneka Claire Hoogvliet and Hoogvliet Trustees Limited as to a 1/3 share Interests Subject to Section 11 Crown Minerals Act 1991 Subject to Part IV A Conservation Act 1987 Appurtenant hereto are rights of way and rights to drain sewage and stormwater and to convey water, electricity, telecommunications and computer media created by Easement Instrument 9528868.3 - 26.11.2013 at 12:41 pm The easements created by Easement Instrument 9528868.3 are subject to Section 243 (a) Resource Management Act 1991 Subject to a right to drain sewage and stormwater in gross over part marked E and G on DP 503215 in favour of Queenstown Lakes District Council created by Easement Instrument 9528868.4 - 26.11.2013 at 12:41 pm The easements created by Easement Instrument 9528868.4 are subject to Section 243 (a) Resource Management Act 1991 Subject to a right of way, right to drain sewage and water, right to convey water, electricity, telecommunications and computer media over part marked E and F on DP 503215 created by Easement Instrument 11072000.4 - 24.7.2018 at 2:36 pm Appurtenant hereto is a right of way, right to drain sewage and water, right to convey water, electricity, telecommunications and computer media created by Easement Instrument 11072000.4 - 24.7.2018 at 2:36 pm The easements created by Easement Instrument 11072000.4 are subject to Section 243 (a) Resource Management Act 1991

18

Identifier

755236

180-182 GORGE ROAD QUEENSTOWN

19

180-182 GORGE ROAD QUEENSTOWN

20

180-182 GORGE ROAD QUEENSTOWN

Due Diligence To assist in the assessment of this offering, comprehensive due diligence information is available via a secure documents link. For access to all documents please register your interest with one of the agents.

•

Information Memorandum

•

Certificate of Title and Interests

•

Lease Documentation

•

Land Information Memorandum

•

Seismic Assessment – Sullivan Hall Report dated 12 April 2023

•

Planning Assessment – Clark Fortune McDonald & Associates Report dated 25 May 2023

All enquiries, requests for information and arrangements for site inspections are to be directed to the Colliers sole agents:

Rory O’Donnell +64 27 445 3982 rory.odonnell@colliers.com

Mary-Jo Hudson +64 21 667 880 maryjo.hudson@colliers.com

21

180-182 Gorge Road Queenstown FOR SALE BY NEGOTIATION colliersotago.co.nz/67025955

Rory O’Donnell +64 27 445 3982 rory.odonnell@colliers.com

Mary-Jo Hudson +64 21 667 880 maryjo.hudson@colliers.com

DISCLAIMER: This Information Memorandum has been prepared solely for information purposes in order to assist interested parties in making an initial evaluation of the property and does not constitute advice nor purport to contain all of the information that a prospective purchaser may require. In all cases interested parties must conduct their own investigation and analysis of the property and the data set out in this Information Memorandum to satisfy themselves in all respects and not rely on the information in this Information Memorandum to make their purchasing decision. This Information Memorandum has been prepared in good faith and with due care by Colliers, but neither Colliers nor the Vendor accept responsibility hereunder for the accuracy of any part of the information contained in this Information Memorandum. Therefore the recipient/s of this Information Memorandum to the extent that they rely on the information contained herein do so entirely at their own risk. The Vendor and Colliers NZ Limited (and its brokers) expressly disclaim all liability for representations, express or implied, contained in, or for omissions from, this Information Memorandum or any other written or oral communication given to any prospective purchaser in the course of their evaluation and/or offer. This Information Memorandum does not constitute an offer for sale or purchase or otherwise.

Please be aware that Mortgagee Sales can present more risk to purchasers, we recommend you take advice from your lawyer in this respect.