Penrose opportunity rare in tightly held industrial market

Penrose opportunity rare in tightly held industrial market

Brokers say a 2,204sqm freehold industrial property in Auckland’s well established industrial suburb of Penrose is a rare investment opportunity in the tightly held precinct.

Colliers International brokers Brad Johnston, Paul Jarvie and Greg Goldfinch are marketing the multi-tenanted property at 60 Hugo Johnston Drive, which returns a rental of $366,390 plus GST per annum. It is for sale by deadline private treaty on 12 October 2016, unless sold prior.

“There are two standalone buildings on the 4,175sqm freehold site. A 1,117sqm two-level office building fronting Hugo Johnston Drive. To the rear of the site sits a 1,087sqm standalone warehouse with a separate entrance and secure yard,” says Johnston.

The property is located approximately 300m down Hugo Johnston Drive, which comes off the main arterial road Church Street providing immediate access to Great South Road and the Penrose/Mount Wellington SH1 motorway interchange.

“The facility sits in a sought after industrial location at the southern end of the Penrose industrial precinct. Surrounding the development are predominantly larger scale manufacturing, logistics and distribution entities including quality neighbours such as Sharp, Sistema, World Vision, Carter Holt Harvey, and BJ Ball,” says Jarvie.

“This is the perfect split risk industrial investment opportunity in a proven location with multiple tenants providing security and a good mix of occupiers and industries,” Johnston adds.

“This property has quality tenants including Healthcare of New Zealand and Fresh to Go. Healthcare of New Zealand has been providing in-home services for nearly 30 years to over 20,000 New Zealand families. Fresh to Go are a very successful family business that provide made to order salads to supermarkets, cafes and hospitals throughout New Zealand,” says Jarvie.

Penrose is earmarked for Auckland Transport’s proposed East West Connections, the Government programme aimed at improving freight efficiency, commuter travel, and public transport. The projects will focus on connectivity and ease of transport between Onehunga, East Tamaki, and Auckland Airport over the next 30 years.

“The Onehunga-Penrose area generates a staggering $5 billion per year, and contributes to 8% of Auckland’s GDP. 64,000 people are employed there and it sees the movements of 6,000 heavy vehicles per day just along Church Street,” says Jarvie.

“The programme includes two priority projects currently underway, one of which is improving transport and freight connections between Onehunga and Mt Wellington. This is will be a game changer in respect to Penrose’s strategic locality and desirability as an industrial precinct,” says Goldfinch.  It is currently proposed that Hugo Johnston Drive will connect directly to the new expressway via an interchange.

“Travel times and travel time reliability between businesses in the Onehunga-Penrose industrial area and SH1 and SH20 will be significantly improved, as will be connections in and out of Onehunga-Penrose, and the reliability of public transport between Mangere, Otahuhu and Sylvia Park,” says Goldfinch.

“We are excited to see the programme identify the area’s current and future transport network issues and the funding commitment to improve it. This will ensure the network can continue to support the growing movement of people and goods, making Penrose properties soar in value and desirability as investment options,” Johnston points out.

Penrose is a major industrial hotspot in Auckland. It is highly desirable for its proximity to the CBD, only 9kms away to its southeast and its access to motorways north and south. It is also close to the Auckland International Airport, only 13kms away.   

The property is currently zoned Business 6 and will be changed to Heavy Industry once the Unitary Plan becomes operative. “It’s quite rare to get this zoning for an industrial property in South Auckland that allows for a wide range of industry and in a market that is increasingly tight and experiencing a severe shortage of available land,” says Johnston.

The proposed zoning permits development of up to 20m, which reduces the areas close to residential and public open space zones. This zone will accommodate sites that are large enough to house large-scale low intensity industrial activities, with smaller sites discouraged.

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