Home Direct’s Wellington base is up for sale and leaseback; with its new six-year lease, modern construction and price tag of under $1 million picked to be popular among investors.
The 1290sq m freehold site at 2 Jepsen Grove, Wellington, was constructed in 2005. It is being marketed by Colliers industrial broker Tim Julian for sale by deadline private treaty closing on December 8. The property is generating approximately $67,000 plus GST in annual net income.
Julian said such offerings are scarce and will be attractive to investors seeking better yields than those available on bank deposits and other debt securities, within reasonable risk parameters.
“There are several features of this property which should attract investors, including the well known national tenant, automatic two per cent annual rent increases and prominent corner location.
Industrial properties with good fundamentals are as popular as ever among investors looking for uncomplicated, stable assets to add to their portfolios, said Julian.
“Buyers often like modern industrial properties as they tend not to demand capital in the way office and retail properties do, with their need for more ongoing refurbishment and more building services such as lifts and air conditioning systems.”
Julian said the 646sq m building provides a modern warehouse facility suitable for a wide range of uses on Business Industrial-zoned land. “The building has excellent access, yard areas and generous on site parking. It is only five minutes’ drive from banking and shopping in the Upper Hutt CBD.”
The neighbourhood incorporates a typical range of industrial uses including warehousing and workshops and also has a large low rise office park at the end of the street, occupied by Inland Revenue.
The industrial market in Wellington is experiencing the lowest vacancy rates for a generation, said Julian.
“Rental growth is strong and is likely to continue. This is due to an increase in demand for space, limited supply in the pipeline and significant numbers of properties being removed from the total stock. The availability of properties has decreased as a result of public works such as the Petone to Grenada link Road, the Flood Protection work in the Melling areas and the conversion of properties to retail such as Briscoes/Rebel Sport, Kmart and Bunnings developments.”
Home Direct is a privately-owned Kiwi company that has been in business since 1973. It is known as a market leader in the direct selling industry and the company employs over 250 staff who sell online, over the phone and via mobile shops.
It offers close to 2000 products across clothing, nursery, manchester, audio visual, gaming, toys, furniture, personal care, health and beauty products, phones, household appliances,whiteware, recreation and outdoor products.
The property is on the market as part of a nationwide portfolio of four Home Direct warehouses located in Auckland, Hamilton, Wellington and Dunedin, which can be purchased individually or together.
The opportunity to purchase all four as a mini-portfolio offering a good geographical spread from Auckland to Dunedin is a plus for buyers, says Colliers’ national director of industrial Greg Goldfinch.
“Taken as an entire portfolio, the properties offer a stake in four different main centres, offering a good level of geographical diversification.”
Each property offers its own set of strong investment characteristics, and will also appeal to buyers looking to add quality industrial assets to their investment holdings, he says.
“Whether purchased individually or together, the assets are likely to appeal to a wide range of buyers. “