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Investors on the money as historic bank building goes up for sale

A landmark Art Deco commercial building that has been a prominent part of Hastings’ inner-city townscape for nearly a century has been placed on the market for sale.

The historic three-storey building, on the corner of Market and Queen streets, dominates a high-profile intersection in the heart of the city’s CBD, in an area targeted by the local council for major redevelopment.

With tenancies anchored by the Co-operative Bank, it forms part of a financial precinct featuring some of the country’s leading banking brands.

Built in the late 1920s, the building for sale was one of the few major structures to survive unscathed in the 7.8-magnitude Hawke’s Bay earthquake which laid waste to much of the region in 1931.

It was designed and engineered to be earthquake resistant by Edmund Anscombe, one of New Zealand’s most influential architects whose buildings can be seen throughout the country.

Anscombe’s offices were in the Market Street building. When the 1931 quake struck he is said to have continued eating his morning tea on the site, believing an architect “should have faith in his work”.

The land and building addressed as 124 Market Street North and 200 Queen Street West are now being marketed for sale by way of a tender closing on 24 November through Bayleys Havelock North.

Salespeople Daniel Moffitt and Jake Smith said the approximately 1,085 square metres of freehold land for sale housed a total built floor area of 3,600 square metres which was unit-titled.

The structure had a seismic rating of 70 percent of new building standard, Moffitt said.

“The ground floor houses the key anchor tenant, Co-operative Bank, and two other tenants. The first and second levels offer vacant office space which presents an immediate opportunity to refurbish or redevelop,” Moffitt said.

“Options available to new owners include upgrading these areas into A-grade office space, or converting them to short-term residential accommodation or new inner-city apartments.”

All existing leases in the property for sale included clauses allowing for building re-development,” Moffitt said.

Further income was also possible from the sale of naming rights to tenants of existing or newly-developed spaces.

Also available to buyers was another property two doors along at 118 Market Street, which could provide a complementary opportunity through redevelopment as a substantial CBD car park, Moffitt said.

He said any future redevelopment would sit within the CBD east inner city regeneration project promoted by Hastings District Council. This sought to revitalise the area with improvements such as cross-block pedestrian laneways and better links between shopping areas and off-street car parks.

Smith said three ground-floor spaces at the main corner site for sale were fully leased, generating gross annual rental income of $128,311 plus GST per annum.

The Co-operative Bank pays $57,821 plus outgoings and GST for its premises. Its current lease runs through to 2024, with two further six-year rights of renewal.

A second space is leased to the Te Matahou o Takitimu Charitable Trust on a lease that extends to 2024, with a further three-year right of renewal. It pays annual rent of $40,000 plus outgoings and GST. The third area is occupied by a martial-arts training provider on a monthly basis, generating gross rental income of $12,120 plus GST.

Smith said the building’s strategic location, with extensive frontage to both Market and Queen streets, was one of its strongest features.

“The property for sale lies towards the north western fringe of the Hastings CBD, one block to the north of Heretaunga Street, which is traditionally regarded as the city’s main retail street,” Smith said.

“The property’s Commercial (8C) zoning under Hastings District Council’s district plan offers flexibility for a wide range of retail, office and, above ground level, for residential accommodation.”

Neighbouring properties include retail banks ASB, SBS and Kiwibank, as well as the co-working and shared-office hub, Hastings HIVE.

Smith said the Hawke’s Bay’s primary-producing economy was booming, while soaring house prices were fuelling consumer spending and boosting property fundamentals for apartment developments in particular.

House prices in Hastings had lifted nearly 10 percent since this year’s Covid-19 lockdown, making it the second-best performer nationally, he said.

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