Asmuss leaseback offers long-term income

Well-established New Zealand industrial and construction supply company Asmuss is selling two substantial distribution centres on new long-term leases with locked-in rental growth.

Located in Lower Hutt and New Plymouth, the properties are superbly positioned within two of the best-performing industrial precincts in the lower North Island.

Both are on new 10-year initial lease terms from settlement. The leases return a combined $742,401 in net annual rent, with annual rental growth fixed at 2.75 per cent.

Asmuss has appointed Colliers International to market the properties for sale and leaseback. They can be purchased either individually or together as a portfolio.

Offers by way of deadline private treaty close at 4pm on Wednesday 23 October, unless one or both are sold prior.

Paul Jarvie, Industrial Director at Colliers International, says the properties offer excellent investment fundamentals, underpinned by exceptional tenant covenant.

“Both are fully leased to H.J. Asmuss & Co Ltd, which was founded in 1920 and remains one of the largest privately-owned companies in its field.

“Specialising in steel, pipes, fittings, fencing and valves, the company has supplied many of the biggest industrial and construction projects in New Zealand.

“The strength of this covenant is matched by the quality of the properties. Both are large, versatile industrial facilities that are suitable for a range of uses, from manufacturing to distribution.”

Greg Goldfinch, Industrial National Director at Colliers, says both properties are well located in popular areas that offer good access to markets and transport infrastructure.

“The Lower Hutt property is situated in the heart of Seaview, which is one of the largest and most sought-after industrial precincts in the Wellington region.

“Located at 11-13 Gough Street, it comprises a 5,407sq m industrial facility on a highly visible 9,091sq m freehold site.

“The New Plymouth property is smaller but also more modern, having been constructed only three years ago.

“Located at 82 De Havilland Drive, in the centre of the established Bell Block industrial precinct, it comprises a 1,279sq m

building on a 7,092sq m freehold site.”

The Lower Hutt property returns $569,151 plus GST in net annual rent, while the New Plymouth property returns $173,250 plus GST.

The New Plymouth lease has three rights of renewal of five years, with final expiry 25 years from settlement. The Lower Hutt property has four rights of renewal of five years, with final expiry 30 years from settlement.

Wellington Industrial specialists Kieran Lennon and Tim Julian say the Lower Hutt property is located near the end of Gough Street, where it is highly visible from the Seaview roundabout and Port Road.

“The property comprises a large, level site with a warehouse and office that was developed in the 1960s and more recently extended,” says Lennon.

“The warehouse is split in two – an original main warehouse of 1,993sq m and a newer warehouse of 1,898sq m.”

The main warehouse comprises four high stud bays and a lower stud lean-to. Access is via multiple roller doors and a large sliding door at the front, allowing for drive-through capability.

There are six gantry cranes, most with a five-tonne capacity aside from a single two-tonne gantry.

The newer warehouse is lower stud. Access is via roller doors at each end and one on the side.

The offices and amenities are situated in front of the main warehouse. They are largely open plan with one partitioned office.

There is also a small office and amenity area within the smaller warehouse.

The remainder of the site, which is accessed from two points via Gough Street, comprises sealed yards on each side of the building.

Julian says the Seaview area has good support infrastructure and remains at the core of industrial activity in the Wellington region.

“The area is mostly occupied by larger industrial users including transport and logistics companies, heavy machinery businesses and service providers, engineering businesses and manufacturers.

“Well-known occupiers include Dulux, Callaghan Innovation and Masterpet, while iconic properties include the Seaview Marina and the historic Ford Motor Assembly buildings.”

The New Plymouth property comprises a recently built industrial building on a regular-shaped level site with a large rear yard.

It provides 1,070sq m of high stud, clear-span warehousing along with office, showroom and amenity areas.

Benet Carroll of Colliers New Plymouth says access is via two full-sized roller doors with canopy protection.

“A single roller door at the rear provides for drive-through access, while gantry rails with five tonnes of capacity run the full length of the warehouse.

“The 175sq m office, amenity and showroom area is at the front of the building. It has a mixture of open plan and partitioned offices.

“The rear of the site features a large yard suitable for storage and allowing for circulation and manoeuvring. The building has been designed to allow for future expansion utilising the rear yard.

“There are three points of access, two off De Havilland Drive and the third off Vampire Place, allowing for full drive-around access.”

Carroll says De Havilland Drive is located minutes from New Plymouth Airport and the CBD, with direct access from State Highway 3 to the west.

“The wider Bell Block area is characterised by long-standing industrial occupiers with relatively large landholdings.

“Surrounding properties accommodate top national and multinational companies including Ballance Agri-Nutrients, J Swap, Gough Cat and Mainfreight.

“The area has gone through significant growth in the past few months, on the back of strong occupier demand and the favourable investment environment.

“We are seeing a lot of activity and some outstanding developments such as the new Halliburton premises. ADM, one of the world’s largest food agricultural processors, has constructed an 11,000sq m warehouse adjoining Asmuss, testament to the attractiveness of the area.”

Carroll says since May 2018, some 7,000sq m of industrial space has been absorbed by tenants, leaving little vacancy.

“Land is also being steadily purchased with an industrial site sale a month in Bell Block alone, this year.”

H.J. Asmuss & Co is part of the Asmuss Group, which comprises a number of companies operating throughout New Zealand.

The group has supplied major projects including the Fonterra Darfield dairy factory, Tauranga wharf extension, Lyttleton wharf builds, Wairakei geothermal plant expansion, Forsyth Barr Stadium, Eden Park redevelopment, Victoria Park tunnel, Tekapo Canal remediation and Carlaw Park redevelopment.

The company’s products are used in a wide range of industries, including industrial and commercial construction, pulp and paper, dairy, agriculture and horticulture, power and energy generation, water and waste water, petrochemicals, fire protection, and heating and ventilation.