Established tenant offers rent security

Close to motorways and with a reliable sitting tenant, the Wairau Valley site is a good opportunity.

The long-term home of well-known paint and coatings company Dulux at 135-139 Diana Drive in the North Shore's growing Wairau Valley industrial precinct is for sale.

The property is being sold on behalf of Broadway Investments Limited and consists of two adjoining buildings occupying a single-titled 6324sq m site with 66.8m of road frontage.

John Bedford and Simon Farland of CBRE, and Matt Prentice and Shoneet Chand of Colliers International, are jointly marketing the property by public tender, which closes on July 18 unless sold before.

Bedford says that Broadway Investments purchased the property in 1998 and Dulux has since invested millions into plant, machinery and fit-out to ensure that its operational capabilities were continually upgraded.

"It is a highly functional site with two main buildings that Dulux has leased for several years to come. The property also offers real potential to add value over time, and its popular Wairau Valley location makes it all the more appealing for investors," says Bedford.

The original buildings date back to the 1970s and comprise a two-level administration facility at the front of the site, which sits in front of a high-stud factory behind.

Farland says a number of additions and alterations over the years mean the present structure has a net lettable area of 4054.7 sq m, although the total floor area, including mezzanines and working platforms that have been installed and are owned by Dulux comes to about 4400 sq m.

"This property has been used as a manufacturing site for 26 years now, so it is an industrial facility that has really stood the test of time. Its low office content means that the utility of the site as a manufacturing plant is consistently maximised."

The eastern building, comprising a total lettable area of 1802.1 sq m, serves as an administration wing containing laboratories, workrooms, offices, plant rooms and storage areas on two levels.

A ground-floor workshop occupies space formerly taken up by a spray booth.

In 1994, a new tilt slab extension was added to the rear of the building to house an acrylic batching plant.

The western building encompasses a total lettable area of 2252.6 sq m with the front of the building providing the customer entry and main administration functions. Offices and amenities have been extended beyond the original two level administration block and into the original factory/warehouse.

The building houses the cafeteria and main factory area including the main milling and grinding facility. More blocks house plant and equipment.

The two buildings are set back from all boundaries, offering ample room for car parking and enabling full drive-around capability for trucks.

Prentice says the property, along with its plant and machinery continue to be developed and upgraded to keep in step with the latest global technology.

"Although this is a site built in the 1970s, the inside of the buildings have been exceptionally and meticulously maintained, so there is a modern and fresh feel to the interior, which is testament to the calibre and commitment of the tenant and also to the add value potential of the buildings. Further future upgrading could still be undertaken, particularly the exterior, if the new owners want to continue to add value to the property."

Prentice says Dulux recently agreed to a new six-year lease renewal in March, paying a net rent of $398,000 a year plus operating expenses.

"Dulux has three further six-year terms available, with a final expiry in 2036, which provides stable and secure long-term income for the new owners".

Dulux has used the Diana Dr site as its powder-coating materials base for the past 14 years, operating under the Orica NZ brand, occupied the property in March 1998.

Bedford says the sale is an ideal investment opportunity for high net worth investors, syndicates and family trusts.

"Wairau Valley is a very tightly held area, and the security offered by the long-term lease period and significant plant and machinery investment by the tenant provides a very attractive investment proposition for any investor."

Chand says the property, which has prime road frontage, is well positioned in the Wairau Valley precinct.

"The site is just 200m away from Wairau Rd, so connections to the Auckland-Waiwera motorway and the Northern motorway are quickly and easily accessed, making the property an ideal location from a logistics and distribution perspective."