A five-star hotel and a new four-storey retail and office complex are two of the developments being touted for one of Tauranga City's biggest commercial properties, currently up for sale.

The 2449sqm site on the corner of Spring and Durham streets features two large commercial buildings and has a rateable valuation of $5.46million.

The old Public Trust building is up for sale.

Existing tenants within the block include education service Te Wananga o Aotearoa, and homeware and furnishings retailer Tres Chic. The Public Trust has just vacated the ground floor of the building.

The property is being marketed for sale by real estate agents Bayleys, through a tender process closing June 19.

Bayleys Tauranga salesperson Rob Pinny says the offering consists of four parts - the main building housing 1790 sqm over three floors, an adjacent annex building of 200sqm , a 139sqm retail store, and on-site car parking for 45 vehicles.

Initial feedback from potential buyers looking through the site a redevelopment into a mixed-use location - with retail units at street level, new commercial premises immediately above, and the option of an apartment complex on the upper floors.

"Anything above the fourth or fifth storey would command expansive views of the inner harbour and the CBD, and with careful design, the number of car parks could be expanded.

'With dual street frontage of between 49 - 51 metres, the location has the potential for two entry/exit points for vehicles, rather than the existing single entry point,” says Rob.

A development concept plan for a new four-storey 8482 retail and office complex - complete with 82 covered car parks - has been drawn up, and is available for viewing by potential purchasers.

The report comes with a traffic impact report and resource consent from Tauranga City Council.

Rob says another developer is looking at the option of building a new 220-room four to five-star hotel. The benefit of having sitting tenants would allow for necessary planning consents and approvals to be granted during the interim period.

"Tauranga is lacking a major branded accommodation provider at the top end of the market, and I can see the logic of building such an amenity to service the corporate sector operating in the central city.

"As with the apartment proposal, hotel rooms on the upper floors would have excellent views over the city - and all just a few hundred metres walk from the social infrastructure, which hotels seek to be associated with.

"It has been highlighted that, from a hotel operator's perspective, the dual street access would suit a covered portico-type structure and allow for easy handling of tour buses.”

Council's upgrading of the CBD during the past six years had enhanced the character of the downtown/midtown shopping precinct – with improvements made to roading, footpaths and improving the environmental impact of a growing commercial centre.

"Often with central city refurbishment it's a ‘Mexican standoff' between public and private enterprise. In this case the council has taken the lead to regenerate the area, and now it looks likely that investment will bring in considerable private money - so ultimately it's a win-win scenario for businesses in Tauranga.

"Any combination of an apartment or hotel redevelopment with a mix of retail and office would see a significant addition to the inner-city's skyline and would complement the modernisation seen around the surrounding area in the past 12 years."

Te Wananga o Aotearoa lease expires in December 2015 with a further one year right of renewal with notice to be given to extend for a further year to December 31 2016, by December 31 this year.

Tres Chic has a lease expiring this year with one further three year right of renewal subject to a demolition clause. Combined, the two tenants generate rental income of more than $379,000 annually.