Steel & Tube's substantial East Tamaki distribution centre is being marketed for sale as a long-term leaseback investment opportunity.
"This quality tenanted property is superbly located in the sought-after Auckland industrial hub of East Tamaki," says Andrew Hooper, Colliers International's industrial sales and leasing director. Hooper and colleague Greg Goldfinch are marketing 68-80 Stonedon Drive for sale by deadline private treaty closing at 4pm on Tuesday, November 14, unless it is sells earlier by negotiation.
"The 3.64ha industrial property over four titles is on a new 10-year lease, with a six-year certain term, to vendors NZX-listed Steel & Tube - a well-known steel product manufacturing and distribution business," Hooper says.
"It's only minutes from the Highbrook Business Park and the lease offers investors a solid passive income of $2,036,087 plus GST in net annual rent, with locked-in increases of 2.25 per cent a year."
Hooper says the property is one of the best industrial investment assets to come to the market this year.
"With 2017 coming to close, this will be one of the last opportunities for investors to position their capital before 2018 rolls around," he says.
Goldfinch says the Light Industry zoned property has a net lettable area of 18,126sq m and comprises a substantial industrial building made up of a warehouse and associated offices.
The 14,959sq main warehouse was built as a steel store and has a stud height of 9.5m at the knee rising to 11.7m at the apex spanning across three bays.
"Vehicle access to the warehouse is via sliding barn-style doors," Goldfinch says.
"A largely open-plan 850sq m office, which also includes partitioned offices and meeting rooms, is attached to the main warehouse.
"The warehouse building also includes a small dispatch office, plate processing office and amenities block totalling 404sq m."
Goldfinch says a second building, located at the southeastern corner of the site, comprises a 209sq m office and a 1703sq m warehouse with a stud height of 9m at the knee rising to 9.8m at the apex. The offices are predominantly open plan with a small portion being partitioned.
The property has full drive around capability with direct access to the main office building off Stonedon Drive and is fully fenced with security gates as well as on-site car parking.
Goldfinch says the Stonedon Drive location is near the Southern State Highway 1 motorway via both the East Tamaki and Manukau interchanges giving easy access to the nearby industrial areas such as Wiri, Auckland Airport and Mount Wellington.
"East Tamaki itself is an established industrial location which has benefited from recent large-scale development, including the Highbrook Business Park and Eastfield Industrial Park.
"The area around Stonedon Drive comprises a mixture of small, medium and large scale industrial premises with the eastern end of East Tamaki expanding towards Te Irirangi Drive."
Steel & Tube is a leading steel provider with more than 60 years of trading history and supplies a wide range of products through its national network of branches and distribution centres to the construction, heavy and light engineering, energy, manufacturing, viticulture and rural sectors.
Hooper says a strong tenant covenant makes this sale and leaseback offer a sound passive investment.
"We're anticipating strong interest in this rare opportunity to acquire a substantial tenanted investment in a premier industrial location."