JLL is marketing 2-12 Titirangi Rd, New Lynn, a sprawling 2.2ha site underpinned by a lease to Bunnings Warehouse.
Bunnings New Lynn, the second-largest store operated by the group in New Zealand, features a net lettable area of 10,722sq m made up of a modern large-format store and associated facilities including retail, timber yard, garden area, café, offices, canopies and inward goods area.
The whole package sits on 22,096sq m of freehold, Metropolitan Centre-zoned land that includes generous undercover customer car parking.
The store services the high-growth catchment of New Lynn, within 10 kilometres of Auckland’s CBD.
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The site at 2-12 Titirangi Road was purpose-built for Bunnings in 2014. Bunnings Group Limited is owned by ASX-listed Wesfarmers which has interests predominantly in Australia and New Zealand, operating in retail, chemical, fertiliser, industrial, and safety products. Wesfarmers generated total revenue of AUD$43.55 billion in the 2023 financial year.
Bunnings New Lynn is being offered to market via an International Expressions of Interest campaign, closing Wednesday 6 December 2023 at 4pm (NZST), unless sold prior.
JLL Capital Markets Broker, Harry Fergusson, says the strength of the retail sector, in particular large-format retail stores, makes this a stand out opportunity within the property market, with abundant opportunities for future growth in the sector.
“The large-format sector has been an asset class in hot demand both domestically and offshore,” says Fergusson. “This has been off the back of strong rental growth within the sector and assets typically sitting on sizeable and highly valuable land, which is underutilised by the landowner.”
Beyond the sector’s strengths, JLL Capital Markets Director, John Davies, suggests the covenant with ASX-listed Wesfarmers-owned Bunnings Warehouse, combined with favourable underlying Metropolitan-zoned land, cements this as a defensive investment.
“Bunnings Limited are approximately half way through their initial 12-year lease with further rights of renewal lined up,” says Davies. “This gives the buyer income security from a robust multinational tenant with solid foundations, making it a significant addition to any property portfolio, and a rare opportunity in the tightly held Auckland market.”
JLL Retail Investments Senior Director, Nick Willis, reinforces the secure nature of the large-format asset class, making opportunities such as the Bunnings New Lynn site highly sought-after.
“Transaction volumes for Bunnings Warehouse assets are down 72% over the last two years compared to the run we experienced from 2020 to 2021,” says Willis. “During that time, we saw 25 transactions totalling over $1.15 billion for these assets across Australia and New Zealand. In Australia this year, we have seen two transactions, the highlight being Bunnings Collingwood, which demonstrates the continued demand-supply opportunity in this robust investment class” says Willis.
Co-Head of JLL Metropolitan Sales, Jonathan Lynch adds “Capital for the large-format sector has been dominated by private investors and a select group of major institutions. However, given the assets have similar fundamentals to logistics properties, we are now seeing the emergence of new capital sources that have identified genuine value in this sector.”
This is a chance to secure a rarely available opportunity in Auckland’s New Lynn. The demand for large-format retail sites, and for those operated by significant multinational tenants in particular, adds to the appeal of 2-12 Titirangi Road, New Lynn.
- Article supplied by JLL
