Any advice on investing in Murupara?

[Kre8eve]

I've been looking at buying a commercial property in Murupara town centre and was wondering if any of you would like to chime in to work out the pros & cons...have never been there...just found out that the town has a population of about 3000 and the main industry is forestry.

Here's the details:

Location: Murupara (40mins from Rotorua, 1hr to Taupo and 3.5hours to Auckland)
Investment: Commerical building, 10% at asking price ($150,000)

Sale Details:

Land size: 0356ha
Estate: Fee simple (Freehold)
Rates: $1621.66
Regional rates: (included in the above)

Age:1970-80

Dwelling size: 260sqm
Cladding: Block
Roof: Trimline roofing iron

Tenancy: Lease 2+3+3+3yr - $15,000 p/a (starts leasing in September)
Business: Superette (only one in the town, that's what I'm told)

__________________________________________________ ____________________

Additional information:

Own driveway for truck access
Walk-in refrigerator unit,
Shelving,
Security doors front & rear
Security bars on rear windows
Alarm system
Extra storage facilities
Large office
Smoko-room
2 x toilet/bathrooms

Any response is highly appreciated!

[Shalodge]

The town is struggling..

The latest population in Murupara is 1800. (2006 census). It has been dropping by about 15% every census.

There is no employment. The forestry industry there has closed down.

There are empty residential sections where houses have been removed. They are being given free to neighbours so they will be kept clean..

Put Murupara into trademe property search..

Property is not a good investment in that town at the present.. IMHO

[Realtorman]

Sounds like a disaster to me.
I believe your title is an oxymoron.

"Investing in Murapara"

Particularly in relation to commercial property.

[[email protected]]

Forget it. In a slump phase with the boomers approaching retirement stick to main centres. You only want to invest where there is huge industry/employment and growing population IMHO.

[flyernzl]

Rule of thumb I picked up somewhere is "never invest in a town where the population is less than 20,000. Any smaller and they tend to be one-employer/one industry towns. If that employer strikes trouble or moves away, the town folds."

[Davo36]

Dude you should be able to get 10% in commercial property in Auckland very shortly. Just wait.

David

[Hec]

that property has been for sale for over 2 years.......

think about it.....

minimum 20 - 25% for a town like that.

if you tried hard enough you may get 10% in auckland now

Hec

[Kre8eve]

Thanks

Hi Guys!

Thanks for your "words of caution"...much appreciated!

Can I add a TWIST to this?

What if I asked you HOW would you make this deal work, what INSANE offer would you put on this commercial property, given that at least the tenant is locked in for 2 years? (2+3+3+3 lease term)

[Realtorman]

I predict that in 10 years time Murapara will cease to exist.
There may be a few people living in run down houses toughing it out but that would be about it.

What use would your property be then?

Plenty of other cases around NZ like this as the drift to larger population areas continues.

Why own a property in a ghost town at any price?

[Green Fish]

I would at least check out the Auckland "shoe-box" apartment market, before diving into Murapara. It's not a place for the faint-hearted.

[spurner]

To add to all the above definite "no's" to investing there:

I wouldn't invest in any place I'd never heard of before, and/or I couldn't point out on a map.

Invest some place nearby to where you live, so you can keep an eye on it and the market there in general. Don't buy into this crap about investing in different towns all over the country.

[Kre8eve]

Point/s taken!

Thank you SO MUCH for your responses...appreciated!

[dannym]

The facts ...

I just read this old post about our commercial building in Murupara

The property has not been for sale for 2 years.

It was for sale before this for only a short time at a lot lower price before we had advise of rent we could achieve ... so we cleaned the content out of the building and painted it. A lease was signed a few weeks later for $15,000 a year. It was put back on the market to investors - because that is what we do, trade property.

The business is going to do well there as there is strong demand for their services.

For the FACTS please ask me questions

Regards

Danny

[Halfway To Paradise]

I live in Rotorua and have never been to Murupara but from what I hear it is definately a place to avoid. Seems from what I hear the majority of people who buy property there move it out to a section in Rotorua.

[dannym]

Will your information is incorrect Halfway to Paradise. Moving houses from there was stopped by the Whakatana Council awhile ago.

Can I suggest we look at positives of this small town and the financial numbers, instead of destroying it.

We should be encouraging people to invest and help the town grow with positive thought and words.

As a company we have helped the town grow by investing and fixing up many many properties there. Working with tenants, etc.

Sorry we are not joining the NZ doom and gloom sayers who have given up on a lot of our wonderful small towns.

Visit: http://www.networkmurupara.co.nz/

And look at all the positives going on in this wonderful community.

regards
Danny