Tenanted industrial investment with Steel & Tube on new 10-year lease
NZX-listed company Steel & Tube’s substantial East Tamaki distribution centre is being marketed for sale as a long-term leaseback investment.
The 3.64ha industrial property at 68-80 Stonedon Drive is offered for sale by deadline private treaty closing at 4pm on Tuesday, 14 November, unless sold prior.
Colliers International Industrial Sales and Leasing Director Andrew Hooper and Greg Goldfinch, National Director Industrial Sales and Leasing, are marketing the property and believe it is an outstanding sale and leaseback opportunity.
“This quality tenanted investment is superbly located in the sought-after Auckland industrial hub of East Tamaki, only minutes from the Highbrook Business Park,” Hooper says.
“The property is on a new 10-year lease, with a six-year certain term, to vendors Steel & Tube – New Zealand’s leading steel product manufacturing and distribution business.
“The lease offers investors a solid passive income of $2,036,087 plus GST in net annual rental returns, with locked-in rental increases of 2.25 per cent a year.”
Hooper says the property is one of the best industrial investment assets to come to the market this year.
“With 2017 coming to close, this will be one of the last opportunities for investors to position their capital before 2018 rolls around,” he says.”
Hooper says Colliers International has assisted Steel & Tube with numerous property transactions over the last decade and is thrilled to have been appointed to sell one of the company’s most significant property assets.
Mark Malpass, Steel & Tube Holdings Limited interim CEO, says the sale and leaseback offer is a unique opportunity.
“Steel & Tube is excited to offer this unique opportunity to purchase a substantial property in one of Auckland’s premium industrial hubs,” he says.
“The opportunity comes with the benefit of NZX-listed Steel & Tube as a large, well-known and long-term tenant.”
Goldfinch says the Light Industry zoned property offers a net lettable area of 18,126sq m.
“The property comprises a substantial industrial building made up of a warehouse and associated offices situated on a 3.64ha site over four titles,” he says.
The 14,959sq main warehouse is built as a steel store and provides a stud height of 9.5m at the knee rising to 11.7m at the apex spanning across three bays.
“Vehicle access to the warehouse is via sliding barn-style doors,” Goldfinch says.
“A largely open plan 850sq m office, which also includes partitioned offices and meeting rooms, is attached to the main warehouse.
“The warehouse building also includes a small dispatch office, plate processing office and amenities block totalling 404sq m.”
Goldfinch says a second building, located at the southeastern corner of the site, comprises a 209sq m office and a 1,703sq m warehouse.
The warehouse provides a stud height of 9m at the knee rising to 9.8m at the apex. The offices are predominantly open plan with a small portion being partitioned.
The property benefits from full drive around access, with direct access to the main office building off Stonedon Drive.
The site is fully fenced with security gates as well as on-site car parking.
Goldfinch says the Stonedon Drive location offers excellent proximity to the Southern Motorway via both the East Tamaki and Manukau interchanges.
“Easy access to the nearby industrial areas such as Wiri, Auckland Airport and Mount Wellington make this location extremely desirable,” he says.
“East Tamaki itself is an established industrial location which has benefited from recent large-scale development, including the Highbrook Business Park and Eastfield Industrial Park.
“The area around Stonedon Drive comprises a mixture of small, medium and large scale industrial premises with the eastern end of East Tamaki expanding towards Te Irirangi Drive.”
Steel & Tube is New Zealand’s leading steel provider, with more than 60 years of trading history.
From its national network of branches and distribution centres, the company supplies products to the infrastructure, commercial and residential construction, heavy and light engineering, energy, manufacturing, viticulture and rural sectors.
Steel & Tube is the leading supplier of stainless, engineering steel, fastenings, and irrigation products and services in the country.
It distributes and manufactures numerous products, from nuts, bolts, nails, piping, roofing and farm fencing, to the largest structural steel products used in commercial construction, such as purlins, girts, joists, universal beams and seismic mesh.
Hooper says the strong tenant covenant makes this sale and leaseback offer a sound passive investment.
“We’re anticipating strong interest in this rare opportunity to acquire a substantial tenanted investment in one of New Zealand’s most premier industrial locations.”
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