East Tamaki industrial has future upside

12:00 PM Friday March 30, 2018 True Commercial

Each day more than 25,000 vehicles pass 107 Harris Rd – identified by a blue border. Photo / Supplied

A newly refurbished showroom and warehouse property for sale in a high-profile East Tamaki location offers potential buyers a split-risk investment with future development upside.

The 8093sq m freehold property at 107 Harris Rd is for sale by deadline private treaty closing at 4pm on April 18, unless sold earlier.

It is being marketed by Colliers International industrial sales and leasing brokers Jolyon Thomson, Dwayne Warby and Greg Goldfinch.

Thomson says the property has six tenants paying $693,105 a year net, making it an ideal split-risk investment.

“With Auckland’s industrial vacancy rate remaining consistently low, there is enormous tenant demand for high-quality, well-located units,” he says.

“Harris Rd is one of the main arterials through Auckland’s established and popular East Tamaki industrial precinct. Substantial street frontage gives huge exposure to more than 25,000 cars-a-day, so it will appeal to showroom and trade retail tenants.

“With low site coverage of only 37 per cent, the property also has abundant future redevelopment potential — especially as developable industrial land in Auckland becomes scarcer.

“As a passive, split-risk investment with long-term potential, 107 Harris Rd really is hard to beat.”

Warby says the property has a net lettable area of 2994sq m and was recently refurbished to a high standard.

“Three high-calibre tenants occupy the street-front showroom and warehouse units, all of which are signed to new five-year leases,” he says.

“These tenants are all part of well-established multinational companies, which should be of extra comfort to investors.”

NZ Safety Blackwoods leases a 543sq m showroom and warehouse at the north of the site, paying $130,000 a year in rent, with two rights of renewal of two years extending the total lease term until the end of 2026.

“NZ Safety Blackwoods is New Zealand’s largest personal protective equipment supplier, with 24 locations throughout New Zealand,” Warby says.

“Established in 1949, the company is a subsidiary of Wesfarmers Industrial and Safety — part of Australia’s Wesfarmers group, a retail and trade giant that operates a number of well-known brands including Bunnings.”

Ideal Electrical occupies 253sq m adjacent to NZ Safety Blackwoods; paying $144,665 a year in rent, with two three-year rights of renewal extending the total lease term until the end of 2028.

Warby says Ideal is an electrical supplies wholesaler with 28 locations nationwide.

“Founded in 1936, the company is part of Paris-based Rexel International Group, a leading multinational electrical supplier.”

Choices Flooring occupies the adjoining 267sq m tenancy paying $117,800 in annual rent, with final lease expiry at the end of 2028.

Warby says Choices was established in the Australian state of Victoria in 1959.

“The company has more than 140 locations across Australia and recently expanded into New Zealand, with its first local store opening in 2016.”

The remaining three tenants include Smales Cars, Unity Scaffolding and a vendor lease back, all of which are signed to leases of between one to three years.

Goldfinch says the property has a Business Heavy Industry zoning, which is the most intensive industrial zoning under the Auckland Unitary Plan.

“The zone is designed to promote economic growth and allows for industrial activities that may produce objectionable odour, dust and noise emissions. Development of up to 20m is permitted.”

Goldfinch says East Tamaki is an established industrial precinct that continues to attract top national and multinational tenants. “East Tamaki remains the go-to location for companies seeking high-quality manufacturing, warehousing or distribution premises in New Zealand’s largest and fastest-growing city,” he says.

“The Harris Road property in particular is close to the Southern Motorway via both the East Tamaki and Manukau interchanges.

“It also has easy access to nearby industrial areas such as Highbrook, Manukau City and Mount Wellington, making the location extremely desirable.

“The immediate surrounding locality comprises a mixture of small, medium and large scale industrial premises with the eastern end of East Tamaki expanding towards Te Irirangi Drive.”