T&G Global has sold its Mt Wellington property to Goodman Property Trust for $65 million and will lease it for up to four years while it figures out what kind of office and logistics space it needs.
The fresh produce exporter sold the 5.8 hectare site while it works how to best use its capital in New Zealand. The property encompasses office space, warehouse operations and its transport business, and is bordered by Auckland's southern motorway.
"T&G will lease back the site for a period of up to four years while it looks at options for the future including developing a fit-for-purpose facility where it can better service the needs of customers, growers and its people in the future. The sale of the site is an opportunity to grow the business, forge efficiencies and accommodate future growth," it said.
Goodman Property has been targeting high-quality Auckland industrial sites, which it sees as offering stronger growth than other property classes.
The lease is for two years with an option to extend out to 2023. Goodman Property bought a site in Mangere late last year which is also leased to T&G.
John Dakin, chief executive of Goodman's manager, said Auckland's industrial market is at capacity and securing brownfield assets is essential to meet tenants' needs over the next five-10 years. About 31 per cent of the site is used, he said, which meant Goodman could further develop or intensify the land.
"This is another great long-term investment for the trust. The property features functional industrial facilities and with immediate access to SH1 it has excellent connectivity with major freight and transport infrastructure," he said.
The transaction reflects a passing yield of 5.1 per cent and is expected to settle on Sept. 26.
T&G shares last traded at $2.55 and Goodman units were recently at $2.215.