Matvin has Auckland covered end to end

Property developer Matvin is building two industrial parks at opposite ends of Auckland.

The five-unit Orbit Industrial Park, one of the biggest industrial developments under construction on the North Shore, is being developed on a site of just under 1ha at the Interplex subdivision.

On the other side of the city, Matvin is launching Vogler Industrial Park on a 5300 sq m site carved off Auckland Steel's property at Vogler Drive, Wiri. Auckland Steel operates from the rear of the property.

Colliers International industrial brokers says the developments are available for owners, investors or tenants at a time when the industrial market has shown remarkable growth.

Figures from the Property Council's Investment Performance Index show Auckland industrial property returned more than 24 per cent to investors last year. The 11 per cent jump from the previous year has been driven by a significant increase in capital return, says Alan McMahon, research director for Colliers International and the Property Council.

Capital returns for industrial property around New Zealand at 14.4 per cent are the highest ever recorded in a single year. However, McMahon says capital growth is about more than investment demand. An essential ingredient is strong tenant demand driving rental growth, and this part of the equation is also contributing to growth.

The index shows commercial investors receiving an average return of 18 per cent across all sectors.

The George Clark-designed Orbit Industrial Park is a development of five units ranging in size from 950 to 1280 sq m. Features of the development are the 2.7m office stud and low ratio of office to warehouse. In some units it is down to 27 sq m of office, although Colliers International's Pierce Corbett says Matvin will be flexible in these sizes in the early stages of the project. It's an opportunity for owner/occupiers to have the units built to their specifications, says Corbett.

The warehouses have 9m studs at the lowest point, which gives them 30 per cent more capacity than the recently sold Triton Industrial Park, a six-unit development at Interplex. Corbett and Chris Beasleigh sold half the development within a month of it being launched and the entire development was sold within two months.

A total of 93 carparks have been incorporated into the Orbit Industrial Park site - a minimum of 17 carparks per unit based on size.

Units are selling upwards of $2 million each and Corbett expects buyers to snap them up.

"For more than two years there have been limited opportunities to buy 1000 sq m plus vacant industrial buildings on the North Shore," he says.

"The 2 per cent industrial vacancy rate for bigger buildings and zero vacancy rate at Interplex is an all-time low.

"Options for owner/occupiers are few and far between. Many are waiting for existing buildings to come up but they are rarely available and the business operations of some companies are being affected by the inefficiencies of the buildings they occupy."

Many businesses are now considering leasing rather than owning as the scarcity of available options bites.

"This is probably one of the last big greenfield sites on the North Shore and we expect demand to come from existing local companies wanting quality premises that will give them the chance to lift the profile of their business."

Corbett says the new development is due to be finished in December/January, giving owner/occupiers plenty of alternatives when it comes to sitting down with the architect and designing their premises. Investors also have plenty of time to find tenants in a buoyant leasing market.

Vogler Industrial Park is a smaller development with the five units ranging in size from 630 sq m to 980 sq m. Construction is expected to be completed early next year.

Two units with exposure to Roscommon Rd will have 155 sq m of showroom to take advantage of passing traffic and the extension of SH16 to SH1.

Three of the units have dual access from a shared right-of-way. The full concrete construction units will have 6m studs and there is some flexibility in the ratio of office-to-warehouse, although Murdoch says there is already a good mix of sizes.

There is a big shortage of mid-sized industrial unit developments in South Auckland and a dearth of 1000 sq m new buildings. Unprecedented demand last year for warehouse space in South Auckland had made any new development popular.

Prices for the units range from $975,000 to $1.5 million and they will suit a wide range of companies, says Murdoch.

Matvin has been involved in various commercial and residential developments across Auckland for some time and director Kevin Clark says the company has been successful by being sympathetic to the needs of owner/occupiers, investors and tenants.

"It's no good just making a development work on paper. To provide attractive quality developments that work financially for the client and developer, you have to listen to what the market wants and work with the market."

Clark says working on developments at either end of Auckland at the same time is not difficult.

"The fundamentals of the industrial market are the same on the North Shore as they are in Wiri."