Substantial Hawke's Bay industrial site now on open market

A substantial slab of Hastings industrial estate with long-term leases to a mix of local and international tenants is the largest industrial offering ever to be placed on the open market in the Hawke's Bay.

Colliers International has been exclusively appointed to market the Tomoana Food Hub.

The spread of five modern warehouses on individual freehold titles as well as a large area of development land, is just off Elwood Rd and spreads across 19.97ha.

The properties are for sale either individually or together, allowing prospective buyers to acquire one or more titles.

The offering is being presented to the market by Danny Blair, director of Colliers International Hawke's Bay, in conjunction with industrial national director Greg Goldfinch.

"Never before has such a substantial industrial offering been placed on the open market in the Hawke's Bay," Blair said.

"This is an unprecedented opportunity to acquire a prime industrial offering that boasts exceptional investment fundamentals."

He said the diverse portfolio had a long 10.5-year weighted average lease term, along with a great mix of local and international tenants, as well as a top location close to all main transport routes.

"The five warehouses are leased to Tomoana Warehousing, Jamestrong Packaging and Fonterra on long-term leases returning $2,557,765 plus GST in net annual rent," Blair said.

"With a further 8.84ha of industrial-zoned land zoned available for development, this magnificent A-grade industrial investment opportunity ticks all the boxes that any astute investor is looking for."

He described it as the Hawke's Bay commercial offering of the year.

The portfolio fronts on to Elwood Rd, and is "strategically positioned" between the two main arterial routes, SH51 and SH2 as well as the new Whakatu arterial link and is close to all main transport routes around New Zealand.

Goldfinch said the portfolio made for an astute buy, as New Zealand's industrial sector continued to go from strength to strength.

"The appetite for quality industrial properties throughout New Zealand is strong, with yield-hungry investors competing for the limited amount of available stock," he said.

"Hawke's Bay has a particularly strong industrial property sector due to the underlying productivity of the regional economy — the main driver is the primary sector, which is forecast to deliver robust returns this year, particularly in the horticulture and viticulture sectors."

He said as a result there would continue to be high demand for quality industrial properties, especially within the food production, distribution and rural services sectors.

The portfolio is anchored by Tomoana Warehousing, which occupies two properties at Hanui Rd and Elwood Rd.

The Hanui Rd property is a 6,012sqm industrial facility on a 2.08ha site while the facility on Elwood Rd comprises a 6,872sq m warehouse, workshop and office on a 3.38ha site.

Both properties are on initial leases of eight years and eight months commencing on November 1 with the leases including CPI rental reviews every three years, plus two rights of renewal of six years each.

The Hanui Rd lease returns $527,592 plus GST in net annual rent, while the Elwood Rd lease returns $467,000.

Jamestrong occupies two properties at 47 Hanui Rd and 115A Elwood Rd.

The Hanui Rd property was purpose-built in 2017 as a contemporary manufacturing facility with a warehouse, office, amenities, environmental load out, dangerous goods store, concrete yard, asphalt sealed parking and security fencing.

It is leased to Jamestrong Packaging NZ Ltd on a 15-year term from June 1, 2017 with two rights of renewal of 10 years each.

The lease returns $885,471 plus GST in net annual rent, with CPI rental reviews every two years and market rental reviews every four.

The Elwood Rd property is an 8,642.8sqm industrial facility on a 1.71ha site.

The 15-year lease from June 1, 2016 contains two rights of renewal of 10 years each, returning $463,502 plus GST in net annual rent.

Fonterra occupies a 753.6sqm facility on a 1.29ha site and fronts a 1900sqm concrete yard, along with 8800sqm of land for development.