A 4.4ha property in Auckland’s central industrial area offers purchasers and tenants the chance to own or lease the biggest developed industrial land holding to be placed on the market in the Mt Wellington precinct in several years.
100 Carbine Rd, Mt Wellington, is featured in Colliers International’s latest National Portfolio publication which launched yesterday. The property is fully leased to two major multi-national tenants and offers a total gross lettable floor area of nearly 30,000sq m.
It is being marketed by Greg Goldfinch, Brad Johnston and Hamish West of Colliers International on behalf of Norak Properties and is for sale by deadline private treaty closing on September 19. A leasing campaign is being run in conjunction with the sale process and is ongoing.
Although the property is fully leased, there is the possibility larger owner occupiers or tenants could move into part of the facility as early as December 2012.
Goldfinch says large sites like 100 Carbine Rd, with income streams, in Auckland’s central industrial area very rarely come onto the open market. “There are very few large footprint warehouse and office facilities offered to the market in Mt Wellington, whether it be to owners or tenants,” he says.
“The fact that there is next to no greenfield land available for development in Mt Wellington and Penrose makes this property even more attractive as an investment proposition, particularly given the very strong underlying land values in this prime area.”
Goldfinch therefore expects the property to also be of interest to buyers with longer-term add-value options in mind, with the existing leases providing holding income for up to five years. “The property will be attractive to a wide range of parties, including owner occupiers, tenants, developers and add-value investors, owing to its size and excellent location,” he says.
Multi-national tenants
The property’s two leases effectively “split the risk” of future investment returns as well as providing flexibility for the new owner, says Johnston. “The large property easily accommodates two large tenants at present, however in the future the facility could quite easily reconfigure to house one large occupier.”
The two tenants, Aperio Group (NZ) Ltd and VisyPet NZ Ltd, are multi-national corporations providing high quality tenant covenants. Rent review clauses give the potential for future income growth.
Aperio is a packaging company which operates six plants in Australia, four in New Zealand and one in Thailand. It is now part of Amcor, the world’s largest packaging company, following a recent acquisition. The company’s Carbine Rd operations specialise in ‘blown film extrusion’ for the production of food packaging, as well as applications in the agriculture, horticulture and industrial segments.
The company holds a 10-year lease expiring in January 2014 and contributes just over $1m in net annual rental income. Rights of renewal provide the potential to extend the lease for two further terms of five years each. Aperio occupies 11,300sq m of floor area.
Visy was established in 1948 in Australia and now operates over 120 sites in Australia, New Zealand and Asia. It is the world’s largest privately-owned packaging and recycling company, and focuses on sustainable packaging. The company’s Carbine Rd facility produces PET packaging, including plastic bottles.
VisyPet NZ also holds a 10-year lease to its 17,965sq m facility, expiring in October 2017, with the right to renew for a further six years, and pays $1.68m in annual net rent.
Functional industrial accommodation
The property houses various office and warehouse buildings, with the older warehouses constructed in the 1960s, Johnston says. “Recent warehouse extensions have also been added, while retaining the large hardstand yard areas which make this property extremely functional for modern occupiers.”
Both the older and newer warehouses provide high stud, clear span accommodation, he says. “The older facilities are very useable with features such as multiple roller doors and canopies.”
Three street access points – from Carbine Rd, Gabador Pl and Bowden Rd – enhance accessibility for deliveries and goods deployment, Johnston adds. “There is very good truck access throughout the property as well as ample container drop areas.”
Aperio’s portion of the property features ground and first floor offices with a covered walkway leading to the main warehouse/factory. The warehouse is currently split into several areas for various processes such as storage, extrusion and printing, Johnston says. “All areas are interconnecting and offer clear, uninterrupted warehouse and factory space, with stud heights varying from six metres at the lowest point, rising to 12.8m.”
A two-tonne gantry crane and five roller doors on three sides of the warehouse provide easy loading and unloading to the older warehouse.
A high stud warehouse extension was completed at the rear of the main factory in 2004, which is in excellent condition, says West. Access to the new portion of the warehouse is via four roller doors on the northern side which open to a canopied hardstand yard, with direct access to Bowden Road via electric gates.
Visy occupies ground floor offices arranged around a central courtyard, and a main factory/warehouse accessed off Carbine Road with secure yards. Access is provided via three roller doors on the southern side plus two additional doors on the eastern side of the warehouse, which features a stud height of 7m at the knee rising to 10m at the apex.
“A warehouse extension has also been recently completed to the rear of Visy’s older facility, and its part of the property offers plenty of parking and a massive yard,” West says.
Premier industrial location
The property is located on Business 5-zoned land in the centre of one of Auckland’s longest-established and most sought-after industrial areas, says West.
“Mt Wellington is considered one of Auckland’s premier industrial areas, with excellent access to the motorway system and a central location within greater Auckland only 12 minutes’ drive from the CBD,” he says. “The area is highly desirable among occupiers, with a number of major industrial developments accommodating both multi‐national and national occupants commanding some of the top industrial rentals in the Auckland market.”
The property is located very close to Mt Wellington Highway which leads straight to the shopping and cafes of the Sylvia Park commercial hub, West says. On and off ramps to the Southern Motorway are also in very close proximity.
“Mt Wellington is also in demand by importers and distributors due to its central location halfway between Auckland’s CBD and port and Auckland International Airport,” Goldfinch says. “It is a very tightly-held area with a short supply of properties, so those that do come onto the market generally get snapped up very quickly.”
Land values reflect the desirability of the area, with values at $350 to $400 per square metre at the moment, he says.
Recent research from Colliers International shows prime capital values in the Mt Wellington industrial market are expected to increase by 3.5% over the year dating from March 2012. Prime rentals are expected to increase by 3.3% over the same period.
Colliers International’s latest industrial property market research also shows industrial vacancy rates falling across Auckland. Industrial vacancy is expected to fall to 5% by the end of the third quarter of this year, down from 6.2% in August 2010.
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