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Large industrial site at 2 Station Road in Penrose Auckland

Large industrial site at 2 Station Road in Penrose Auckland 1536x1040

12-year sale and leaseback in tightly held Penrose

Kiwi-owned company Phoenix Metal Recyclers is selling its large Penrose industrial site on a new 12-year lease as the owners look to expand the business to meet growing demand.

The sale and leaseback presents an opportunity to invest in one of Auckland’s most tightly held industrial areas, with the benefit of strong tenant covenant and excellent lease terms.

Colliers International has been exclusively appointed to market the 5,296sq m freehold property at 2 Station Road, Penrose, Auckland, by way of deadline private treaty.

Offers close at 4pm on Wednesday 4 September, unless the property is sold prior.

Industrial Director Hamish West, who is marketing the property with colleagues Paul Higgins and Ben Cockram, says it makes for a superb long-term investment.

“A lease of this length is very unique for a property of this size, as they are usually reserved for much larger and higher-risk assets.

“This is a chance to acquire a substantial property that is well located in a low-vacancy, high-demand area, backed by an outstanding tenant in a sustainable growth industry.

“Phoenix Metal Recyclers is a 100 per cent New Zealand owned and operated metal recycling company that provides a full range of professional services throughout New Zealand and the South Pacific.

“The Penrose property is one of six sites across the North Island, and among the most recent additions to the company’s portfolio.

“It was acquired to serve as a key trade retail collection/drop-off facility due to its close proximity to the motorways and important customers, and also because its visibility builds awareness of the brand. 

“With the business in growth mode, the owners are selling to free up capital for further expansion. This presents an opportunity for a savvy investor to share in the company’s success through strong rental returns over the long term.”

Eldon Reeve, Managing Director of Phoenix Metal Recyclers, says the company is committed to future growth.

“We are looking to develop new and existing sites for the group as our business continues to benefit from strong demand.

“Metal recycling is an exciting global industry; and is great for the environment. By recovering re-useable metallics, we are not only diverting material from landfill, as an industry we are also reducing the depletion of natural resources.

“We believe the recycling sector has a significant part to play in our disposable society, as we continue to push towards a cleaner and greener New Zealand.”

The Penrose property offers investors a brand new 12-year lease from settlement, backed by a six-month bank guarantee.

The lease returns $395,000 in net annual rent, with fixed annual rental increases of 2 per cent. There is also one mid-term market rental review, capped at 5 per cent.

An eight-year right of renewal provides for a final expiry date 20 years from settlement.

Higgins says the property comprises a 2,606sq m industrial facility on a massively high-profile site on the corner of Great South Road and Station Road.

“The property comprises two standalone industrial buildings made up of clear-span warehousing with high stud heights, as well as associated office accommodation and amenities.

“Building 1 is the larger of the two and comprises well-presented offices and amenities over two levels, as well as a warehouse to the rear of the offices. Building 2 is primarily a warehouse.

“The remainder of the site is made up of sealed asphalt yard with secure fencing. Access to the site is via a single entrance off Station Road.”

Light Industry zoning allows for a wide range of activities including manufacturing and distribution.

Cockram says the property enjoys excellent access to motorways and main arterial roads, with the State Highway 1 interchange only minutes away.

“It is superbly located in the heart of Penrose, which is one of the closest industrial precincts to Auckland’s CBD.

“The suburb continues to be one of the best performing industrial locations in Auckland, with demand from tenants and investors outstripping supply.

“Its proximity to key staff catchments, ports, Auckland Airport, highway links and its central Auckland location continue to drive demand in the area.

“Continued redevelopment will ensure Penrose remains one of Auckland’s premier industrial precincts.”

Tenant Phoenix Metal Recyclers was originally established in 1985 as Scrap Metal Recyclers.

It was briefly acquired by an ASX-listed global recycling company, CMA Corporation, before returning to New Zealand ownership and management in 2013.

Its current owners have many years of metal recycling experience and have grown the business significantly.

Phoenix Metal Recyclers has acquired companies in Otahuhu, Whangarei and Hamilton and opened new branches in East Tamaki, Onehunga and Penrose, the latter of which is offered for sale and leaseback.

Related Experts

Hamish West

Director | Industrial

Auckland South

With more than twelve years of experience in the commercial and industrial property sector, Hamish has been involved in a significant number of industrial property projects in Auckland and across New Zealand. During this time he has been responsible for the sale of more than $1.4B worth of industrial assets, in addition to providing leasing and design build solutions totalling more than 660,000m² for a range of major local & international occupiers.

Career Success

Hamish has proven to be a consistent and highly effective broker and in 2012 & 2015 was awarded with the Colliers National MVP Award for Brokerage Excellence, and 2015 saw him achieve the ranking of 6th highest revenue earner in Colliers nationally.

Market Specialisation

Hamish specialises in the sale and leasing of high value assets in the South Auckland Property market and has been involved in many projects including:

  • Sale and leaseback transactions
  • Tenanted Investment sales
  • Receivership sales
  • Vacant possession sales
  • Development property sales
  • Land sales
  • Vacant building leasing
  • Design build leasing
  • Tenant property sourcing
  • Purchaser property sourcing

Hamish has done a significant portion of his work with both private clients and corporate clients including Goodman, PFI, Broadway Developments, Southborne Holdings, Stride, Kiwi Income, Auckland Airport, Norak Properties, JKGL Group, Samson Corporation, Southpark Corporation, Quadrant, Location Group, Argosy, Windward Properties, and Depot Investments to name a few.

Recent occupiers include Bunnings, GPC (Repco), GUD, Ricoh, Ideal Electrical, Crown, Sirva, Wedderburn, GEA Process Engineering, Delmaine, Siemens, Hydraulink, Verifone, Sistema, Tyco, Bunnings, Fletchers, PMA Global, Compac Sorting Equipment, and many other SME businesses.

View expert

Paul Higgins

Director | Industrial

Auckland South

Paul joined Colliers in 2005 working in Auckland's industrial team specialising in the mid to upper end sales and leasing market. Paul has also spent a couple of years working for Colliers in the Central and Eastern Europe market where he was Director of Poland's Krakow office. In 2010 Paul returned to Auckland to again work in Auckland's industrial market.

View expert

Ben Cockram

Associate Director | Industrial

Auckland South

I am an Associate Director within Auckland's most awarded industrial brokerage team based in Highbrook, Auckland. 

 Specialising in industrial sales and leasing, I have over 6years  experience in Auckland's highly competitive industrial market and have forged very strong relationships with both owners and tenants. I am a highly motivated individual who approaches all transactions with professionalism, integrity and vigour.  
Since commencing brokerage in September 2014, I have been involved in 121 leasing transactions and 110 sales. Having leased and sold buildings of all sizes in Auckland I have vast experience in all areas of Auckland's industrial market. 

In 2018 I was made an Associate Director of Colliers International NZ. 

As of January 2021;

Total sales transactions - 110
Total sales value              -  $301,271,980 

Total leasing transactions - 121
Total sqm leased                   -  126,600m²

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