A prominently positioned commercial property that is home to Popeyes Louisiana Chicken and Burger King in the South Auckland suburb of Papatoetoe is being presented to the market for sale, offering buyers the opportunity to acquire a top-tier passive investment.
Located at 66-68 East Tamaki Road, the well-known quick-service restaurants are sitting on a 2,329sq m freehold site.
There is 443sq m of total building area across both properties and these brand-new restaurants include state-of-the-art facilities complete with high-end, multi-million-dollar fit-outs.
The offering is fully leased to Premium Chicken Restaurants Limited, trading as Popeyes, and Antares Restaurant Group Limited, trading as Burger King. Both are subsidiaries of New Zealand retail giant the Tahua Group.
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The total net annual rental income from the property is $500,000 plus GST and outgoings split evenly across the tenancies. Both quick-service restaurants have 20-year leases in place that begin on 1 September with one right of renewal for 10 years and one for five years.
East Tamaki Road is a busy arterial that runs off Great South Road. The surrounding area is a hub of commercial activity and Hunters Plaza is a short drive away.
Colliers Brokers Shoneet Chand, Ryan Gibb, and Josh Coburn have been exclusively appointed to market the property for sale via deadline private treaty closing at 4pm on Thursday 21 August, unless sold prior.
Chand, Director of Investment Sales at Colliers, says a property of this calibre will be highly sought-after due to the long-term lease to two blue-chip tenants.
"This is a prime example of a passive investment that buyers are regularly seeking but opportunities like this are rarely brought to the open market," Chand says.
"The lease agreement includes built-in rental growth with 2 per cent fixed annual increases for the first 10 years and after year 10, three yearly market reviews will ensure rental increases to the higher of 3 per cent or the market rate."
Gibb, Investment Sales Broker at Colliers, says the Tahua Group is a fully Kiwi-owned business that operates nationally renowned brands across the hospitality, retail, and health sectors.
"The Tahua Group first brought Popeyes to New Zealand in April last year and it has developed a large following with nine restaurants across the country in locations such as Wellington, Hastings, Papatoetoe, Taupō, Hamilton, Palmerston North, and Albany.
"There are plans for rapid expansion with more on the way that are currently undergoing resource consent. This popular fried chicken restaurant is quickly establishing itself as a favourite with Kiwi customers," Gibb says.
"Approximately five years ago, the Tahua Group acquired Burger King in New Zealand. Its network now spans over 80 stores with continued investment in the brand, including refurbishments in key locations, that has seen its market share expand."
Coburn, Director of Capital Markets and Site Sales at Colliers, says quick-service restaurants have become one of the most attractive asset classes available to investors.
"This property benefits from its prominent location in a heavily populated area of Auckland that is continuing to grow," Coburn says.
"This offering has a string of key investment fundamentals that will be appealing to buyers. Having two highly recognisable brands on a long-term lease in brand-new buildings makes this a low-maintenance investment opportunity that will pique the interest of discerning investors."
- Supplied by Colliers
