The largest block of land to hit the market along Wellington’s tightly-held Kent Terrace strip in some time has strategic redevelopment potential for entities looking to leverage the landholding’s high density zoning designation.

Fully-leased to automotive dealer Armstrong Motor Group, the Mount Victoria land is held in three titles totalling 1,457.5sqm and has dual access.

70-74 Kent Terrace is a 900sqm site supporting a 90sqm refurbished vehicle showroom with offices and a car cleaning bay to the rear, with 36 Hania Street being a narrow 183sqm title which effectively allows through access to Kent Terrace. The title at 30 Hania Street has a land area of 372sqm and there is Resource Consent in place for a six-level apartment building on this site.

The Armstrong Motor Group operation benefits from broad frontage and strong branding profile to Kent Terrace, good visibility from Cambridge Terrace, and secondary drive-on access from Hania Street.

Held in the same ownership for 25 years, and used for automotive sales since, the property is on the market through Mark Walker, Sarah Lyford, and Fraser Press of Bayleys Wellington Commercial via a tender campaign closing 21st May. Prospective purchasers can tender for the site in its entirety, just 30 Hania Street, or the 70-74 Kent Terrace/36 Hania Street parcel.

Armstrongs have a 10-year lease from December 2022 across all sites with no additional rights of renewal. There is net annual holding income of $230,215 plus GST, and redevelopment clauses in place allow the lease on 30 Hania Street to be terminated by the landlord at any time with a minimum six months’ notice, or across the whole site with 12 months’ notice any time after 1st December 2027.

Walker says given the organic lease expiry in 2032, with options to fast-track this, the generational offering provides flexibility for investors or developers.

“There’s really good holding income for a new owner to facilitate planning and due process for a site redevelopment, whether that’s across the whole site or initially, just for 30 Hania Street which already has Resource Consent for a multi-level apartment development.

“The landholding is zoned City Centre, a high-density designation with even greater intensification signalled under the government’s National Policy Statement -Urban Development (NPS-UD).

“Kent Terrace and the wider Mount Victoria area is one of Wellington's most sought-after locations for development, with a new Gibbons Co. multi-unit complex at 30 Kent Terrace a good example of the sort of project that has traction.

“Given the generous holding income in place across the site, this is a landbank opportunity for investors or for switched-on development entities looking to embark on a staged or complete redevelopment initiative.”

The central location close to the Basin Reserve to the south, and Oriental Bay to the north, has good connectivity to the airport making this a pivotal address for a future residential development, says Lyford.

“Inner city living is being championed by government and Council to optimise sites that have strong public transport connections and are in close proximity to good amenity.

“The Kent Terrace property is just 400m from Moore Wilson food merchants, 750m from the Courtenay Place hospitality precinct, and around 800 metres from the waterfront at Waitangi Park so it’s a logical spot for a future residential project.”

There is evidence that the development sector is active again off the back of reduced interest rates, falling construction costs, and a more development-friendly playing field, says Lyford.

“Developers are proactively scoping out well-positioned sites with reasonable scale for future projects.

“Bayleys recently sold the land and buildings associated with the former student accommodation facility Helen Lowry Hall in Karori, receiving nine tenders for the property which was billed as a redevelopment opportunity. This is just one example of the level of interest in the land development sector right now.”