The sale of the only supermarket servicing New Zealand’s most affluent suburb represents an unmissable chance to acquire a newly built, low-maintenance asset in one of the region’s most desirable urban precincts, brokers say.

Bayleys Auckland Metro Markets senior director Alan Haydock and colleagues Damien Bullick and Ian Hall are marketing the 2,342sqm (more or less) freehold site at 1 Kelmarna Avenue on the corner with Jervois Road in Herne Bay.

The property features in Bayleys’ latest Total Property portfolio and is offered for sale by tender, closing at 4:00 pm on Tuesday, 3 December 2024 (unless sold prior).

“Completed in 2022, the boutique Woolworths Metro supermarket sits atop one of the largest mixed-use sites, offering massive profile in a suburb renowned for its prestige, historical character, and well-heeled residents.

“A solid income of circa $1.55 million net pa, backed by a secure 12-year lease and fixed annual rental growth, provides a highly appealing blend of stability and capital appreciation potential in a market where assets of this calibre are tightly held.

“With renewal rights stretching to 2074 and a prime tenant in General Distributors (a Woolworths subsidiary), the asset offers both immediate income and the potential for long-term value growth, anchored by its prime position and an inflation-linked income stream, which is particularly attractive in today’s market where stability is paramount,” says Haydock.

The purpose-built supermarket stands out in the local retail landscape with a total floor area of 1,640sqm (more or less) supported by premium facilities, including a 52-space basement car park, electric vehicle charging stations and dedicated bike racks.

Favourable Business – Local Centre zoning offers significant long-term development flexibility, further underscoring its investment potential.

Bayleys Auckland Metro Markets associate director Damien Bullick says the primary retail level is well-designed and features a variety of speciality departments, including a bakery and deli – along with a coffee bar. “Above the main floor, a mezzanine supports offices and staff amenities, accessible via a Schindler lift providing an efficient blend of retail and operating space.”

“Access to a rear loading dock area and storerooms is from Jervois Road, which has a truck turntable providing ease of manoeuvrability.”

Bullick says the Woolworths Metro is a smaller store format with a boutique operating model. “This better reflects the unique needs of the local community, with the business focused on convenience and a unique product range to deliver premium amenity value for its customer base.”

Herne Bay’s status as New Zealand’s most expansive suburb – with the highest proportion of property sales exceeding $5 million - enhances the asset’s investment value. Bayleys Auckland Metro Markets director Ian Hall says that the area’s affluent demographic demands premium amenities, contributing to a more resilient local economy.

“Jervois Road is a bustling arterial route connecting the CBD with the desirable West City Fringe suburbs, ensuring high visibility and accessibility for the property. This prime location benefits from proximity to Ponsonby’s retail strip and the Auckland CBD, reinforcing its draw for both local and visiting consumers.

“In the context of broader retail trends, the property stands out as a rare opportunity. Herne Bay’s limited supply of commercial properties – particularly those leased to blue-chip tenants, means that properties of this status are rarely available.

“Additionally, the high-density zoning adds future flexibility. For immediate gain, the property stands out as an essential service trophy with a stable, high-income yield, offering investors a rare opportunity in a market hungry for dependable, low-maintenance investments.”