Fully-tenanted Darfield property proved popular

The Property
• A-Grade split-risk commercial investment
• 219sqm of building area on 966sqm site
• Built in 2007
• Two national tenants - Bayleys Real Estate office and Lumino dental practice
• Returning $72,654.13pa + GST and outgoings
• Ample car parking
• 100% NBS rating

Quick Look
• National Total Property marketing campaign – for sale by auction, with extended timeframe due to lockdowns
• Strong enquiry from investors in both the Canterbury region, and around New Zealand
• SOLD for $1,190,000 at a 6.1% yield
• Purchased by a Tauranga-based investor with connections to the Darfield area.

The Story

This fully-tenanted commercial property on Darfield’s main thoroughfare State Highway 73 provided the perfect entry-level commercial opportunity for astute buyers, although the eventual purchaser had an existing portfolio.

Marketed by Julia Ashmore-Smith and Nick O’Styke of Bayleys Canterbury, the original auction date for the property had to be pushed out given that the country went into lockdown during the campaign.

Julia says this made viewings difficult and meant it took longer to complete due diligence, however her vendors had made the decision to sell well-prior and proceeded with confidence.

“The market has been strong despite the pandemic disruptors to business and general life, and commercial properties are seldom available in the town.

“This property was very suitable for a first-time commercial investor given its high seismic rating, tenant credentials, and passive investment nature but also resonated with other investors keen to secure a presence in Darfield.”

As the established boundaries of Christchurch city expand, Darfield is proving attractive to people wishing to buy in Canterbury.

“It’s growing quickly on the back of new residential subdivision developments and the fact that Christchurch is very accessible,” says Julia.

“The successful buyer from Tauranga has family in the area, knew the property, and was pleased to add a South Island building to his commercial portfolio.”

Vendor Comment

Vendors David and Stephanie Rumble found the sales’ process with Bayleys to be personal, transparent, and supportive.

David and Stephanie purchased the former railways’ coal store site in 2004 and had custom-designed business premises built for their dental practice and other commercial tenants.

“As the local dentist since 1999, and being residents of nearby West Melton, this was an opportunity for us to invest in land and a building, and to consolidate our interests in a community that we could contribute to over time,” says David.

“We sold the dental centre in 2018, and earlier this year decided to also sell the land and buildings.

“We knew that the market was strong, and discussions with Julia and Nick of Bayleys assured us that our price expectations were both realistic and obtainable and this gave us the confidence to proceed.”

New Zealand went into full lockdown early in the auction campaign, however, Stephanie says the robust systems and processes and the substantial effort already demonstrated by Julia and Nick gave them “enormous confidence” to remain in the market.

“The calm support they gave us was invaluable and helped us to realise that being flexible around dates, with the potential for an online auction, meant we could remain on the market for sale,” she says.

“Even with COVID-19 upon us, the super-organised information for prospective buyers provided by Bayleys meant we felt comfortable that the sales’ process would be worth pursuing by delaying the auction date, without altering the marketing plan.”

“Ultimately, we feel we obtained exactly what the market was prepared to pay and what we required to move on from a commercial investment.

“Having now sold and purchased a number of residential homes and a commercial property with Bayleys, we trust the agents and have felt important, valued and respected every step of the way.”

Subscribe to receive the latest commercial news and insights from Bayleys Total Property