Six properties in a ‘super’ sale

5:01 AM Saturday March 26, 2016 Colin Taylor

The 6 Apollo Drive, Mairangi Bay property leased to giant multi-national company GEA.

Six Auckland properties owned by Mutual Superannuation Fund (MSF) have been placed on the market following a decision by the directors to wind up the scheme and distribute proceeds from the sale of the properties to the fund’s investors.

The portfolio comprises a mix of bulk retail and industrial properties located in Mt Wellington, Onehunga and the North Shore, plus MSF’s CBD head office.

The properties have current total annual rent roll of $842,000 net plus GST and are being marketed by Sunil Bhana, James Hill and Mike Houlker of Bayleys Auckland.

Featured in Bayleys’ latest Total Property publication containing 79 commercial property offerings, the six properties are up for tender closing on April 14 and can be tendered for individually, in any combination or as a total portfolio.

“They are well located and have a range of income streams and lease terms,” says Bhana. “Together they offer a diverse, ready-made portfolio with split income risk and the ability to divest of individual properties in the future if required. Individually, they provide opportunities for smaller investors as well as owner occupiers.”

The largest of the properties is two industrial buildings totalling 1994sq m on 3093sq m of freehold land at 12 Bowden Rd, Mt Wellington. The property is producing net annual rental income of $218,000 plus GST from a longstanding lease to Glassfields (NZ) Ltd, which was acquired in 2014 by Seeka Kiwifruit Industries Ltd, New Zealand’s largest kiwifruit grower.

Glassfields markets tropical fruits and holds exclusive New Zealand rights to import and distribute Sumifru bananas, pineapples and papayas from the Philippines.

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The Storage Box bulk retail unit in the Harvey Norman Centre, on Mt Wellington Highway.

“Glassfields exercised the final six-year right of renewal on its current lease in January 2012 which means the property offers a variety of future options,” Hill says. “It could suit an owner occupier who would benefit from the cashflow the property provides in the short term while planning their relocation. It could also appeal to an investor who could possibly negotiate a new lease with the current tenant or explore other add-value opportunities given the property’s strong location in one of Auckland’s premier industrial locations”.

Hill says the property is extremely well positioned on the northern side of Bowden Rd, close to the intersection with Carbine Rd, which connects to the southeastern arterial route providing easy access to State Highway One and the eastern suburbs. The property is also within 200 metres of the Carbine Rd entrance to Sylvia Park Shopping Centre with its wide range of amenities for staff.

One of two buildings was built 10 years ago and has exposure to the southeastern arterial.  It comprises a 787sq m warehouse, with a 7.5m stud at the apex and a 30sq m canopy, plus 219sq m of office and amenities over two levels. The building closest to the Bowden Rd frontage contains 797sq m of lower stud warehousing and storage with access via two roller doors and  159sq m of offices and amenities.

Also for sale in the portfolio in Mt Wellington is a 522.5 sq m bulk retail unit in the Harvey Norman Centre, on Mt Wellington Highway, producing net annual rental income of $130,625 plus GST. It is leased by Panmure Plasticswares Ltd - part of the national Storage Box franchise retail chain which has 17 individually owned stores nationwide from Kerikeri to Invercargill. The tenant’s current six-year lease runs until February 2020 and has further rights of renewal for six years after that.

Bhana says the unit is well located in a central positon opposite a main pedestrian entry point within the popular bulk retail centre containing a number of other national and international tenants like Harvey Norman, Briscoes, Rebel Sports and Hannahs. The unit comes with six designated carparks but there are also 400 shared common carparks on the 4.7ha site.

Another property with a well-established tenant is for sale in Onehunga. It comprises a 1395sq m industrial building on a 1975 sq m site at 120 Captain Springs Rd which is producing net annual rental income of $162,563 plus GST. 

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The Repco auto centre at 1/79-81 Wairau Rd, North Shore. 

The building has been occupied for over 20 years by Applico Ltd on a lease expiring in September this year with no rights of renewal. The firm imports global home appliance brands that include Smeg, Baumatic and Viking,

“Applico has indicated it would like to stay so there could be an opportunity for an investor to negotiate a new lease with them,” says Hill.  “Alternatively, the offering may appeal to an owner occupier wanting a prime piece of real estate for their own use with some short term holding income in place.”

The property has a 1028sq m concrete block, clear-span warehouse built in the late 1980s with mezzanine storage added in 1998 along with some additional offices. A 366sq m two-level office annex fronts Captain Springs Rd and provides a good standard of accommodation, with air-conditioning throughout/ Amenities include a large lunch room and secure outdoor barbeque area and the site has good parking and room for unloading containers.

The smallest property for sale in the portfolio is a 66sq m ground floor unit at 198 Federal St in the Auckland CBD which is used as MSF’s offices.

It is part of the five-storey Federal Court building which has three levels of commercial tenancies with residential on the top two floors. Hill says the unit has a good mix of open plan and partitioned offices, a board room and reception and its own separate men's and women's toilets. It also comes with two covered and secure carparks.

“The property is in a very convenient CBD location that will be given further impetus by the nearby development by Sky City of a new exhibition centre and hotel,” says Hill. “It is an ideal, affordable opportunity for an add value investor or an owner occupier in the professional services industry.”

Hill says MSF would be willing to negotiate a short term lease of its premises to suit the requirements of a new owner with a holding net annual income of $32,610 plus GST. 

The remaining two properties in the MSF portfolio are located on the North Shore with the first being a 1339sq m industrial building on a 2145sq m site at 6 Apollo Drive, Mairangi Bay. Leased to giant multi-national company GEA it is producing net annual rental income of $173,478 plus GST. The firm is one of the world’s largest suppliers of technology for the food processing industry and other process industries and is listed on the German stock exchange. It employs about 17,500 people worldwide and generated revenue in excess of EUR4.6 billion in 2015.

The sixth and last property in the portfolio is a 695 sq m Repco auto centre at 1/79-81 Wairau Road producing net annual rental income of $125,000 plus GST. The modern tilt slab building developed in 1999 has substantial frontage to the busy arterial road and is leased to Repco for nine years from November 2013, although it has two rights of early termination.

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Sunil Bhana (left) and James Hill (right), of Bayleys Auckland.