Corner an opportunity opposite Hagley Park

A prominent mixed-use building with favourable zoning on the corner of Riccarton Road and Deans Avenue, adjacent to the western edge of Christchurch’s Hagley Park, is for sale and comes with layers of potential for reinvigoration, expansion, or conversion.

The substantial unit-titled building comprises The Parkview on Hagley hotel, two ground-floor hospitality tenancies, and a carparking building which services the hotel and tenant businesses.

The property has an expansive profile to busy arterials, Riccarton Road and Deans Avenue. The site is zoned High Density Residential, with consented use for traveller’s accommodation with associated restaurant and bar, retail space and car parking.

Built in 2007, the circa-2,684sqm building has a detailed engineering evaluation dated 2013, which notes the building as being over 73 percent new building standard.

The Parkview on Hagley Hotel provides 40 self-contained suites under management but being sold with vacant possession. Accommodation includes standard, executive, and premier executive suites, plus two top floor premier executive penthouses. The units have quality finishes and fixtures, full air-conditioning, double-glazing and soundproofing.

There are two street-level retail/hospitality units, and both are fully leased. This provides a base net annual income of $308,406.48 plus GST per annum. Unit 2 is 409.6sqm and occupied by Monster Chicken restaurant, while Unit 3 has 569.9sqm lettable space and is home to Thai Chef restaurant. Both leases have renewals taking final expiries out to 2041 and 2029 respectively, regular rent reviews to market providing rental growth, and personal guarantees.

The hotel and both hospitality tenants have access to a substantial 94-park carparking building known as Unit 4, located on the south-west corner of the site and accessed from Bartlett Street.

The entire property is available to purchase, with 1 Riccarton Road, Riccarton, being marketed for sale by negotiation through Blair Young of Bayleys Canterbury.

This is one of the highest profile properties in Christchurch, given the pivotal corner site close to Hagley Park and average 30,000-plus daily vehicle movements from arterials Deans Avenue and Riccarton Road, says Young.

“There are several upsides to be considered here, with the location holding appeal for developers, hotel operators, and investors.

“The hotel suites could be rebranded, or repositioned as serviced apartments, and placed under management, the hotel accommodation and amenity offering could be expanded, or the upper levels could be converted to residential accommodation.

“The underlying zoning is High Density Residential, the carparking ratio is high, and the property is in-zone for preferred schools.”

Young says subject to engineering investigation, there is potential to develop a further 20-plus hotel rooms over three floors to the Riccarton Road frontage above Unit 3, currently occupied by Thai Chef.

“Additionally, to the Deans Avenue frontage, there is a common area that has not been built on and this could support further rooms, or guest amenities such as a pool.

“While the market will ultimately determine the value of the property, to replace that building in today’s construction climate would be in excess of $30m so there is definitely an intrinsic opportunity to be realised.”

Christchurch is widely considered to have an undersupply of hotel accommodation, and occupancy levels for existing stock is among the highest in the country. Events held at the new Te Pae Convention Centre and expanded inbound flight capacity are helping drive occupancy for Christchurch hotel assets, and Young says visitor activity is about to ramp up even further.

“The Parakiore Recreation and Sport Centre open soon, and the much-anticipated One New Zealand Stadium opens in April next year. These new venues are driving confidence in the commercial accommodation sector and underpin the value proposition on offer with the Parkview on Hagley property.”