Revamped split risk Onehunga industrial
The Onehunga industrial property for sale at 210 Nielson St, Penrose – identified by red border.
A refurbished Onehunga industrial property with a solid cash flow from four leases is on the market as an investment opportunity with a diversified income stream.
“Located at 210 Neilson St, this is an excellent proposition for investors,” says Hamish West of Colliers International who, with colleagues Tim Wylie and Ben Herlihy, is selling it by deadline private treaty closing on Wednesday July 15, unless it sells earlier by negotiation.
The property comprises 4387 sq m of floor area on a 6358 sq m freehold, Business 6-zoned site.
West says the property has a mix of high quality office and showroom component over two levels along with manufacturing and warehouse areas.
High and medium stud, clear span warehousing, manufacturing and distribution space is complemented by associated amenity areas and accessed via five roller doors. Plenty of car parking and container moving areas are on-site.
Herlihy says current net income amounts to $404,465, with rent reviews built in to all four leases.
Fletcher Construction holds a six year lease with rights of renewal providing a possible final expiry date of September 2029.
Cosell, a well-established national commercial refrigeration company, has also taken a six year lease plus renewals, with a possible final expiry in January 2027.
Renoarts Ltd is an Australian art products supplier holding a four year lease with rights of renewal and a possible final expiry of August 2022.
And Traffic control company Alpha United also holds a four-year lease with renewals, potentially extending to May 2023.
“The property’s strong tenant covenants, new leases and good income stream will be draw cards for buyers, along with the potential for income growth through regular rent reviews,” West says.
Herlihy says there is some upside in the rentals as the market has risen since they were written and there are also fixed increases in the leases.
“For buyers looking for high profile and well-functioning property assets to add to their portfolios at a time of increasing demand for industrial sites in Auckland, this building offers compelling investment fundamentals.” he says.
Until 2013, the property was occupied by a longstanding owner occupier who made the decision to relocate after 23 years.
The vacant property was then sold by Colliers’ industrial team to the current owner, who separated the buildings into multiple tenancies, refurbished all the spaces and, with Colliers’ assistance, leased them to the current occupiers.
Wylie says the refurbished interiors are in new condition and present particularly well.
“The renovation work and new leases have resulted in the excellent asset now being presented to the market.”
Herlihy says the split-risk nature of the multi-tenanted property will also be a plus for many buyers. “Investors are attracted to industrial property investments which are leased to several different tenants – reducing the income risk if a single tenant vacates the property.
“With a lease in place to New Zealand’s most prominent construction company, along with three other strong tenants, this property offers a compelling proposition for the risk-conscious investor.”
He says the building's wide Neilson St frontage has also had a makeover presenting a modern and clean glazed street profile to over 20,000 vehicles passing the site daily.
The site's accommodative Business 6 zoning allows for the widest range of industrial uses in Auckland, including heavy industrial.
Herlihy says excellent road and motorway access and a location within easy reach of the Auckland CBD have contributed to the Neilson St area undergoing significant regeneration in recent years.
Neilson St is a feeder route connecting the State Highway 1 motorway and State Highway 20 motorway. It is within minutes of Metro Port and on a main arterial route bringing heavy traffic flows directly past the property.
“Direct access to the southwestern State Highway 20 motorway means occupiers at this property have easy transport accessibility to the airport at Mangere and to Manukau without having to suffer the congestion often experienced on State Highway One,” says Herlihy.
Completion of the Waterview connection, which will extend the southwestern SH20 motorway to connect to West Auckland and the North Shore, is expected to further benefit the area.
From left to right; Hamish West, Tim Wylie and Ben Herlihy of Colliers International.