Property Punts, Auckland (2026)

22/11/2024

Another landbank for those with some spare coins in their pockets…

11 Mamari Road, Whenuapai is a 4.5 Hectare landbank site in the growth area of Whenuapai. This Future Industrial site has a DI Score of 83% and sits adjacent a major industrial subdivision on Spedding Road which was part of a $68 million land deal five years ago.

We assessed the engineering fundamentals behind 11 Mamari Rd and it’s path to development. Our analysis suggests it’s an $11.4 million piece of land that has the potential to be sold for significantly less.

The advice we received is “CV $6.75M, happy to present reasonable offers”. So there is potentially a major multi-million dollar equity play right here.

All big numbers but if you like the sound of it, check out the website for more.

Giving this intel out for free right now, but if you do acquire it then don’t forget about a donation our way (a commercial Buyer’s Agent would clip the ticket to the tune of 1.5% the purchase price. This would be for advice that won’t cover the necessary engineering aspects).

31/07/2024

114 Fitzgerald Rd, Drury

A little DCF analysis for a site we looked at last year. This is a premium land bank in Drury and sold for $13,850,000 in 2023. Market fundamentals have deteriorated somewhat in this time and our own analysis suggests this site would be worth around the $10 million dollar mark based on discounted cash flow. This is an efficient piece of land for development, one of the better ones we’ve looked at in the surrounding Drury-Opaheke Structure Plan areas. These type of sites are not listed too often, with Developers usually quietly acquiring them off market. Features include:

✅ High density zoning, offering flexibility on future developments
✅ Fairly flat and regular shaped
✅ Serviced greenfields, adjacent to some other large-scale projects
✅ Minimal loss of development area
✅ A play around with some engineering designs would suggest that an efficient drainage solution could be achieved
✅ The buildings are nothing flash, reducing what is required to pay to secure the land
✅ Has good site access, location and future proximity to the town centre and transport

What do you think it’s worth? You can read more about it via the link

https://propertypunts.co.nz/punts/f/114-fitzgerald-rd-drury

29/06/2024

We’ve been hard at work locating suitable development sites around Auckland from off-market vendors.

Every week you can find a handful of these types of new development listings online. We aim to review them all. Currently we are noticing the following:

1. The vast majority of these listings fail the initial feasibility in the scenario of highest and best use.

2. Most have some engineering complexity (utilities, access, shape factor, building massing, boundary setbacks, location of existing structure, road frontage, overlays, natural hazards to name a few).

3. Price expectations to purchase the site render the project unfeasible. Many vendors are still stuck in a 2021 pricing mindset or hoping to recoup costs.

4. Premium development sites are not often listed. Developers will hold these to the bitter end and would prefer to offload lower quality projects from their portfolio where possible.

5. You have to search really hard right now to find a project where the numbers stack up. Target development margins have adjusted. Although individual risk appetite plays a big part here, you still need to understand what the upper quartile, average and lower quartile profitable projects look like.

6. Although they can be difficult to secure, if you know what to look for in a project site you are better off seeking this out yourself. There’s often one or two decent sites on a typical street.

If you don’t know what to look for, you are rolling the dice on a vast majority of online listings right now. In the case of South Auckland, feasible projects have been few and far between for the last two years. We believe there is a real opportunity to assist in searching and advising on quality projects right now. We have been hunting them out slowly and methodically.

If you are interested in looking specifically for off-market development projects please get in touch. We will gladly assist.

If you would like the details of the North Auckland project listed above, please get in touch.

18/06/2024

Another exercise in reverse engineering…

We looked at 46 & 50 Maungawhau Rd as a development both separately and combined. As the client had a target development margin, the residual land value after construction to maintain the margin was calculated at $1.5M & $3.1M. If you’re bidding against someone that has zero development margin (in this case an Owner Occupier), their “walk away price” may well be higher than yours. It’s not always the Developer with the deepest pockets but it pays to know the engineering and construction costs so you can back calculate RLV. You can apply these principles for anything from a simple renovation all the way up to a master planned community of 1000’s of houses.

Check out the website for a write up on 46 & 50 Maungawhau Rd

29/05/2024

An investment property a little outside the box. 2 Sarawia St is an existing boarding house business in Newmarket. Features:

✅ Cash flow positive from Year 1
✅ Zoned for intensive development
✅ Metres from Broadway
✅ Capital gains potential

Running a boarding house is not everyone’s cup of tea, however this site has high cash flow, capital gains potential and is in a great position for development. Price indications are ~$3M +GST and at this price represents a great investment as we believe it is undervalued. This is prime land close to the heard of Newmarket

Full analysis on the website. Get in touch if you are searching for property deals !

13/05/2024

Otama Development – Blackjack Rd

Here’s a development we assessed for a 12 lot subdivision of the 104Ha farm at Otama

The full write up can be found here
https://propertypunts.co.nz/punts/f/otama

To summarise, we found that the returns on this development would be a good land bank and hold @$4,000,000 exc GST late last year.

It was listed @$5,500,000 exc GST at the time, hence unfeasible.

As the price has now dropped to $4,995,000 inc GST there may be a deal to be made.

As the initial analysis on the website is what we consider first stage “back of the envelope” we doubled back and completed a more comprehensive analysis using EstateMaster. For developments such as this, it is crucial to complete accurate financial modelling which consider the timing of all cashflows as well as cashflow escalations, loan drawdowns, sensitivity analysis and “what if” analysis. If you’re not using a program such as EstateMaster to accurately project the development, you are simply playing with fire.

The residual land value, profit, NPV, IRR and break even dates we calculated on this are now within the realm of making a deal at the farmers listed price. If you would like more information on this deal and the analysis, please get in touch.

16/04/2024

G’day Punters !

Kicking off the week with this off-market gem in Auckland.

In terms of development properties, this one is a great example of what to look for. Features:

✅ Large corner site
✅ Zoned for intensive development
✅ Inner city location, walking distance to CBD
✅ Close to amenities near desirable town centre strip
✅ Transport links
✅ Growth suburb
✅ The building has multiple add value options and the land location speaks for itself. It’s only a matter of time before this block is developed

Check out the website link for further details and watch this space for more moneymakers.

Kind Regards,
Propertypunts

10/04/2024

Here’s one observation of New Zealand’s property market currently:

For owner occupiers, property is getting slammed. Your money is likely better off on term deposit or managed funds if you make the wrong property acquisition.

Take this typical property in Auckland I was looking at. We have assessed this under the owner occupier scenario, using the inputs shown in slide 2.

Let’s assume you manage to buy a little below its market value, you’re going to live in the property and within the first two years do a renovation (it has renovation potential). The numbers for the renovation are typical and you can see them in slide 3.

Some outputs:
- Slide 4 shows the returns over ten years if you didn’t do the renovation. You’re return on invested capital is losing you money until Year 7 and after 10 years you’re only just averaging above bank term deposits. If the brightline rules change again, this investment would lose money after ten years (see Slide 5).
- Slide 6 shows the returns over ten years if you do the renovation. After the first year, the renovation boosts your investment and returns look healthy. In dollars and cents you’ve made $50k. By the second year when the reno is done, your returns drop. This continues until Year 5 due to the effects of debt servicing and paying down the principle start to make an impact. From Years 6-10 you increase again up to an average of 10%, comparable to a managed fund.
- Slide 7 shows what happens if the brightline rules change for any reason (aka change of Government). Effectively, your renovation is only just keeping you afloat as your investment barely breaks even by Year 10.
- If the same set of inputs is applied under “investment property” settings, the returns are more favourable. See Slide 8. Note that you’re comparing apples to oranges now as the tax, deductibility and lending considerations are different. …see comments section for conclusion…

10/04/2024

Here’s one observation of New Zealand’s property market currently:

For owner occupiers, property is getting slammed. Your money is likely better off on term deposit or managed funds if you make the wrong property acquisition.

Take this typical property in Auckland I was looking at. We have assessed this under the owner occupier scenario, using the inputs shown in slide 2.

Let’s assume you manage to buy a little below its market value, you’re going to live in the property and within the first two years do a renovation (it has renovation potential). The numbers for the renovation are typical and you can see them in slide 3.

Some outputs:
- Slide 4 shows the returns over ten years if you didn’t do the renovation. You’re return on invested capital is losing you money until Year 7 and after 10 years you’re only just averaging above bank term deposits. If the brightline rules change again, this investment would lose money after ten years (see Slide 5).
- Slide 6 shows the returns over ten years if you do the renovation. After the first year, the renovation boosts your investment and returns look healthy. In dollars and cents you’ve made $50k. By the second year when the reno is done, your returns drop. This continues until Year 5 due to the effects of debt servicing and paying down the principle start to make an impact. From Years 6-10 you increase again up to an average of 10%, comparable to a managed fund.
- Slide 7 shows what happens if the brightline rules change for any reason (aka change of Government). Effectively, your renovation is only just keeping you afloat as your investment barely breaks even by Year 10.
- If the same set of inputs is applied under “investment property” settings, the returns are more favourable. See Slide 8. Note that you’re comparing apples to oranges now as the tax, deductibility and lending considerations are different. … continues in comments below …

Property Punts

22/11/2024

31/07/2024

29/06/2024

18/06/2024

29/05/2024

13/05/2024

16/04/2024

10/04/2024

10/04/2024

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