Refuse transfer land has silver lining

11:45 AM Friday June 26, 2015 Colin Taylor

This property is for sale or lease at 101-105 and 107 -111 Foundry Rd, Silverdale – identified by red borders.

A large land site with a rare refuse transfer station (RTS) resource consent, multiple tenancies and land giving the prospect of adding value is for sale in Silverdale, north of Auckland.

The 17,042 sq m site with a mix of buildings, yards and future development land is over two, freehold titles at 101-105 and 107 -111 Foundry Rd, Silverdale.

It is for sale or lease through Jimmy O’Brien of Colliers International and colleague Mike Ryan who are marketing it via an expressions of interest campaign closing at 4 pm on Wednesday, August 5 unless the property sells or leases earlier by negotiation.

O’Brien says it as an outstanding investment opportunity with numerous upsides that should be seriously considered by industrial users, investors and developers.

“This property represents the only opportunity to purchase a large land holding with development potential that has an existing consent for an RTS in perpetuity within the Auckland area.

“This gives the site an intrinsic value – particularly to potential buyers already in the waste management industry - that would be incredibly difficult to replicate,” O’Brien says.

“Consents for this type of activity, especially one like this offered in perpetuity, are rarely if ever approved anymore due to restrictions and processes around the Resource Management Act and public consultation.

“The fact there’s also significant potential for expansion and development within the RTS business, and the property itself, underpins its value for any new owner.”

The two titles with two established tenants, generate $327,400 in net annual rental income. 

Site One is occupied by the RTS business, Northland Waste Limited, that has only four years remaining on its lease and produces a net annual rental income of $191,000. The land area covers 6752 sq m of which about 80 per cent is concrete yard.. Two buildings on-site include a 50 sq m office and amenity building, and a 203 sq m refuse transfer structure with three access levels allowing for the unloading and redistribution of waste.

The front, 5500 sq m portion of Site Two (10,291 sq m in total) is leased to Wade Engineering Limited. The lease generates $136,400 in net rental income per year and is halfway through an initial six year term with two four year rights of renewal. The industrial building and yards combine for a net lettable area of 2998 sq m.. 

O’Brien says there is a clear add-value opportunity with an area of about 4500 sq m at the rear of the site currently unused which includes a levelled building platform with capacity to house a warehouse of approximately 850 sq m for which plans have been drawn up.

“The surplus, clear section could either be subdivided and sold off as a separate title, retained for future growth or - given the value of the adjoining properties consented status - incorporated into an expansion of the existing RTS operation by any new owners.

“The benefit that the entire property offers for any potential developer, regardless of whether they take advantage of the consented status or not, is that the existing rental from one or both of the established businesses will provide an appealing  holding income while any future improvements are considered.”

Ryan says the vendor has a preference to sell both land parcels together in one transaction, but they may consider separate offers to lease or sell the various parcels.

“The previous business owners, now the vendors, were at the forefront of introducing new technology and service levels to the residential and suburban waste and recycling industry. They had a dream of developing this site - the only RTS between Albany and Warkworth permitting both public and commercial refuse drop off - into a full waste and recycling facility for the benefit of both the council and public.

“Now they hope someone else realises the value in the property to expand the refuse and recycling operation and continue with what they began more than 30 years ago.”

The Proposed Auckland Unitary Plan specifies light industry zoning for the area, however the property’s existing consent permits heavy industry usage on site, and it also has a licence for hazardous waste management.

“There is extremely limited land supply in the region allowing for yard-based or dirty industrial use like this,” says Ryan.

The two sites are accessed off Foundry Road by a shared, five metre wide access strip that runs alongside a separate, road-frontage workshop and yard premises occupied by Silverdale Estates.

Foundry Road is the main service road within Silverdale Industrial Park, regarded as the principal industrial estate for the Hibiscus Coast, says Ryan.

“The estate is near full capacity with only limited vacant land available.

“Developments in the area are mixed in nature including small to medium sized light-industrial buildings together with numerous larger, single unit developments occupied by service trades and a number of building yards and building supply outlets.”

Silverdale has excellent transport links to both the north and south, located right alongside the main highway and just a few hundred metres from on and off ramps to the northern motorway. Off peak travelling time to Auckland’s Central Business District is about 25 minutes.

Jimmy, Mike.jpg

Jimmy O’Brien (left) & Mike Ryan (right)of Colliers.