Pastry factory tasty proposition for family trusts

The Pastryhouse, a South Auckland factory which has been occupied by Fonterra Brands for the past 10 years, is up for sale with the dairy corporate having recently extended its lease.

The modern, 1438sq m industrial premises at 14 Earl Richardson Ave in Wiri is to be auctioned on December 2 as part of Bayleys' latest Total Property portfolio.

Fonterra makes fresh pastry at the site, with butter providing about one third of the ingredients.

The pastry is distributed chilled or frozen. The Pastryhouse supplies McDonald's, Progressive Enterprises and wholesalers who in turn distribute the pastry to many smaller cafes, coffee shops and restaurants.

David Young, of Bayleys Auckland, who is marketing the property with Mark Pittaway of Bayleys Manukau office, says Fonterra Brands has been in the premises since 2000 when it was vacated by another food processing and exporting company.

"The building was purpose-built for the first tenant and when they moved on, Fonterra took a new lease," Young says. "It originally hosted a sophisticated food processing plant with a lot of cool store space, temperature controlled rooms and special floor drainage which has been maintained to a high standard by Fonterra."

Fonterra Brands has taken a new three-year extension to its lease from December 2009, with two further rights of renewal of two years each which, if exercised, would give a final expiry date of 2016. The property is producing annual net rental income of $152,525.

"The plant is in full production with three shifts covering 24 hours for five days and then it is cleaned over the weekend. The building is kept in immaculate condition to ensure that it complies with the necessary food processing hygiene requirements."

The standalone industrial building comes with 1116sq m of warehouse and processing space with multiple access and a mezzanine storage area of 42sq m. There are also two levels of office space and amenities with 149sq m on the first floor and 131sq m at ground level.

Pittaway says the property is in a popular and well established Wiri industrial location.

"Earl Richardson Ave is close to Wiri Station Rd, otherwise known as State Highway 20, which is a major distributor road leading through the industrial area and providing a direct link from the Manukau interchange of the Southern Motorway to Roscommon Rd and the Southwestern Motorway to the west. "Manukau City Centre is about 1km from the Fonterra plant, as is the Southern Motorway interchange, and Auckland Airport is about 6km away."

Pittaway says there are very few food-grade industrial properties of this size available for lease in Wiri or Manukau.

"The Fonterra premises would be expensive to replicate because of the cost of the specialised fit out," he says. "This is why Fonterra snapped up this property initially, because much of the fit out work had already been done ..."

Pittaway says the property is for sale because a family trust is being dissolved.

"These properties are ideal for family trusts and this is why they rarely come up for sale. In terms of investment properties there are few industrial opportunities available like this that have a strong national tenant already in place."