Industrial estate for sale for the first time in years

A major, multi-tenanted industrial estate occupying a large landholding in the closest industrial precinct to Auckland’s CBD at 528-558 Rosebank Road, Avondale, has come up for sale for the first time in many years.

528-558 Rosebank Road occupies a 49,841sqm road-front site on the Rosebank Peninsula. The near-5-hectare site features eight buildings providing 26,902sqm of lettable area. It is predominantly leased to Unison-owned transformer manufacturer ETEL Limited, which occupies five of the nine buildings and makes up 73% of the net rental income.

Marketed by Bruce Catley, Chris O’Brien and John Bedford, the property is exclusively for sale by Expressions of Interest through CBRE, closing 6pm Thursday 27 August 2020.

Bruce Catley says that investors have a singular opportunity to acquire a multi-tenanted industrial asset with a strong weighted average lease term (WALT) from a property with a high underlying land value.

“The market is aware of 528-558 Rosebank Road as a strategic industrial estate in a superb industrial location, with good reason. As the biggest industrial property offering in this area for many years, it is a noteworthy investment opportunity for the purchaser, which we anticipate will be an experienced developer-investor, industrial investment group or private investor.

“This Light Industry-zoned estate benefits from powerful emerging logistics trends and offers potential for a range of future uses. Demand for modern, well-located, well-connected industrial space is intense due to the focus on last-mile delivery capabilities. Only seven kilometers from Auckland’s CBD and Port, in one of Auckland’s most sought-after industrial locations, Rosebank Road offers the connectivity occupiers are looking for as they seek to ship or receive goods, distribute goods across the upper North Island, or funnel them into last-mile destinations within Auckland.”

Bedford says that the WALT across the estate is 6.5 years, spread across five tenants that together provide an annual net rental of $3,406,642 through the 26,902sqm of lettable space. “The site’s future potential is also a benefit for the successful owner and any occupiers as the layout, with its drive around and secondary egress onto Timothy Place, ensures efficient flow of vehicle movements, with ample yard space and in excess of 300 carparks.”

Anchor tenant ETEL occupies 21,367sqm of the current floor area on the estate. ETEL signed a new nine-year lease structure commencing on 1 August 2019, including steps over the next year to reach $2.5m, as set out in ETEL’s five leases.

Founded in 1956, ETEL designs and manufactures transformers for electricity distribution companies in New Zealand, Australia and the Pacific Islands, says Catley. “ETEL controls the majority of the New Zealand market and enjoys an established presence in Australia and the Pacific region, exporting over 50% of its production. Rosebank Road, where ETEL moved to in 2002, houses its manufacturing facilities and approximately 290 staff. The company’s recent long-term commitment to the property reinforces the desirability of the position and its proximity to a skilled workforce.”

Pharmacy Retailing (NZ) Limited, better known under the brand name ProPharma and part of the Ebos Group Limited since 2007, occupies 2,210sqm at 540 Rosebank Road. In business for over 120 years, Pharmacy Retailing is the only national pharmaceutical wholesaler in New Zealand, distributing pharmaceutical and healthcare products to retail pharmacies throughout New Zealand. The company has more than 250 staff operating from this facility and seven other branches nationwide.

At 556 Rosebank Road, point of sale software company Triquestra occupies 657sqm of office space. Triquestra provides point of sale and omni channel products, supplying software to local and international retailers for the past 20 years, including Discount Tyres and the Department of Internal Affairs.

Mastip Technology Limited, the leading designer and manufacturer of innovative hot runner solutions to the worldwide plastics industry, occupies a 2,197sqm facility at 558 Rosebank Road. Mastip delivers solutions to 40 countries via distribution partners and subsidiaries in the USA, Europe and China.

On the ground floor of the same facility, commercial and residential furniture company Systems Commercial Furniture occupies a 471sqm showroom. Systems designs and manufactures cabinets, chairs, desks or workstations, partitions, tables and other storage solutions.

Acknowledging the range of expiry dates across the estate, Catley says that the estate has been completely repositioned over the last three years, with leases renegotiated and the property refurbished through a major capital works programme.

“The shorter-term lease expiries are in the most modern, A Grade quality, parts of the estate. Given the strong demand by industrial and commercial users, plus the extensive carparking in this location, there will be ready demand for alternative occupiers should existing tenants move on. Furthermore, there are some add-value opportunities worth considering, with the potential to reconfigure the car parks and/or adding additional footprint.”

Catley adds that the growing skilled workforce nearby underpin the location’s attraction for businesses, along with its accessibility via the Patiki and Rosebank Road interchanges to the North-Western Motorway and the wider Auckland network.

“The opening of the Waterview tunnel in 2017 provides greater connectivity across Auckland, ensuring greater reliability and resilience to the region’s transport network. The completion of this route has benefited 528-558 Rosebank Road and contributed to its underlying land value. The estate offers significant value and potential to the purchaser.”