T&G Global site for sale with long-term leaseback opportunity
Unsatisfied appetite for investment properties in Auckland is expected to fuel demand for a large industrial site in Christchurch, owned by T&G Global, formerly known as Turners & Growers.
T&G Global is one of New Zealand’s largest vertically integrated growing, packing, shipping and marketing companies with over 120 years of trading history which has led to the business being a well-respected household name.
Purpose built in 2004, the Dakota Crescent facility, home to T&G Global’s Christchurch distribution centre, is ideally suited to the company’s needs and comprises warehousing, cool and cold storage, a central freight tunnel and quality office amenities on one level.
Sam Staite, Director of Industrial Sales and Leasing at Colliers International in Christchurch, says the company is committing to a long-term lease-back on the asset so it could invest its capital in further business expansion.
There is a new 12-year lease in place with fixed rental increases throughout the term.
“Wigram is highly sought after, T&G Global is a blue chip tenant, the lease terms are extremely desirable, and the large freehold land holding makes this a bottom draw investment.
“The building site coverage of about 46 per cent may allow for some further expansion.
“The building has been constructed with two wings offering future ability to multi-tenant.
“The excellent access and yard areas, coupled with relatively generic improvements, ensure this facility will have excellent long-term appeal to the cool storage, transport and distribution markets.”
Located at 39 Dakota Crescent, Wigram, the 8,100sq m building sits on 18,190sq m of land zoned industrial heavy and includes 99 car parks. It currently returns $965,000 annually.
Staite, who is marketing the property in conjunction with Greg Goldfinch, Colliers’ National Director of Industrial Sales and Leasing, says there has been a marked increase in interest from outside Christchurch, particularly during the past eight months.
“There’s a lot more enquiry for investment stock. We’ve seen national investors increasingly turning their focus to the Christchurch industrial market, because it’s perceived to offer better investment returns than in Auckland.
“The market believes there’s a very slim chance of the sector getting out of whack with the market in terms of oversupply.
“The two markets are quite different. Canterbury has a very strong agricultural outlook that feeds directly into the industrial sector. It’s all about the basics – food, water, shelter.
“Auckland is largely about consumption, distribution and supplying the high population base, Christchurch is about output and export and that drives the industrial market.”
Staite says a recent off-market campaign for a large industrial asset in Christchurch attracted more than $210 million in offers – all from parties outside Christchurch. The property is now under contract.
Earlier this year, Auckland-based syndicator Silverfin bought Metro Glass at 704 Halswell Junction Road for $18.6 million and another Hornby site at 55 Lunns Rd for $12.94 million.
Goldfinch confirmed Auckland investors were certainly looking further afield.
“With demand outstripping supply in Auckland, we are seeing investors broaden their investment criteria and look to other centres such as Christchurch in the search for quality opportunities.
“Industrial investment offerings remain in high demand with limited supply, particularly those that have the big-ticket items covered - quality real estate, quality tenant, lease tenure and rental growth,” Goldfinch says.
The T&G Global story, and that of its entities, dates back to Auckland in 1897 when English-born Edward Turner Esquire started a fruit auction business that went on to become the city’s largest.
Today it has a presence in 12 countries around the world but supplies produce to around 60 by working with growers and distributors globally.
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