An industrial property in the high-growth area of Mount Maunganui has generated investor interest as pandemic-related freight and supply chain issues fuel a shortage of industrial property across the region.
The recently upgraded warehouse on 888sqm (more or less) of freehold land at 71 Hull Road is in prime position less than 500m away from the entrance of Tauranga’s busy port in the heart of the industrial precinct.
Bayleys salesperson Mark Walton says the property is offered to the market at a time of high demand for industrial property, as the uptick in e-commerce trade coupled with supply chain disruptions and freight delays force businesses to seek more warehouse space for product storage, especially around ports.
“The growth of e-commerce over the pandemic has lit a fire underneath the industrial sector in the Bay of Plenty, with properties close to the Port of Tauranga, container terminal and Tauranga Airport most attractive to investors,” Walton says.
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“The Port of Tauranga is New Zealand’s largest container port by volume, and Mount Maunganui is arguably New Zealand’s best-placed industrial precinct, positioned to benefit from the growing need for warehouse accommodation to meet consumer appetites.
“Industrial land values have surged across the region, particularly in Mount Maunganui, where there is a chronic shortage of land available for future development.
“Vacancy rates are near record lows, and investors are paying attention to industrial rental rates, which continue to outperform other asset classes,” Walton says.
Walton is marketing the Hull Road premises with colleague Rory Brown.
The property will be auctioned at 1pm, Wednesday, 28 September 2022, at Bayleys’ Tauranga auction rooms, 247 Cameron Road, Tauranga (unless sold prior).
Comprising three separately lettable units currently occupied by a sole tenant, the property generates a net annual rent of $90,000 plus outgoings and GST.
Local engineering firm Zworkz, which specialises in custom-built aluminium awnings, has a new four-year lease to June 2026 with two further four-year rights of renewal. The lease provides market reviews on renewal and fixed five percent increases every other year.
Brown says the property’s configuration, which would support three independent tenants, provides a split risk opportunity for future leasing, with scope for rental upside potential.
The premises on 464sq m (more or less) is a mix of warehouse, showroom and office accommodation with ample car parking and a security fenced yard.
“The property has been modernised by the current owner with a current seismic assessment of 70% of the New Building Standard, with car parking front and rear plus a secure storage yard.
“Hull Road provides direct access from Maunganui Road to the entrance to the Ports of Tauranga with the precinct a prime industrial and logistics hub featuring excellent connectivity to city infrastructure, rail, and arterial roads.
“The strategic location and a flat, rectangular-shaped site offer add-value potential for future development and industrial zoning supports a broad range of activities, including distribution, logistics, packaging, manufacturing, processing, engineering, cool-stores and marine-related businesses,” says Brown.
Occupants of the surrounding area include civil contractors J Swaps, courier companies New Zealand Couriers and Post Haste, and international port logistics company ISO.
“The location is second to none and positioned to benefit from the economic connectivity of the Golden Triangle, with large occupiers increasingly exploring Tauranga and Hamilton accommodation due to a shortage of industrial space and rising rental rates in Auckland.
“There was a 97 percent rise in industrial consents across the Bay of Plenty in the 12 months to March 2021, with many project timeframes pushed out due to capacity constraints and the rising costs of materials and labour.
“We expect industrial supply will remain tight until the pipeline of planned development comes online over the next decade with future projects concentrated around the Bay of Plenty as the import and export corridor of New Zealand,” Brown says.
- Article supplied by Bayleys
