Farm Source stores sold off for $10m
Six Fonterra Farm Source stores around the North Island have sold at auction for nearly $10 million..
Stores in Morrinsville, Matamata, Ngatea, Putaruru, Opunake, Shannon, Manaia and Galatea went under the hammer.
The properties sold for a combined $9.9 million, all with eight year lease backs to RD1, a wholly owned subsidiary of Fonterra, from their settlement date of July 23.
The properties were auctioned by Bayleys and jointly marketed with CBRE’s director of agribusiness Jeremy Keating.
Keating said RD1 has 71 rural stores nationwide which are being progressively rebranded as Farm Source as part of a move to provide ‘one stop’ facilities providing rural supplies services as well as advice and support to rural communities.
‘‘With many of the stores in the nationwide network now trading as Farm Source outlets, the opportunity is being taken to free up capital to redeploy within the business – providing the chance for investors to secure well leased and located rural properties,’’ Keating said.
Bayleys commercial manager for the Waikato, Bay of Plenty and Taranaki, Richard Graham said there was a lot of interest in the properties.
‘‘We would have had at least a dozen bidders in our Hamilton auction room competing for the four properties that went under the hammer there,’’ Graham said.
‘‘Three of those properties sold at yields of between 6.4 per cent and 6.7 per cent after spirited bidding which reinforces the fact that good quality regional properties with strong lease covenants are attracting plenty of demand and excellent outcomes for vendors. They are also providing higher income returns to investors than are available in major metropolitan markets.’’
The highest price was $2.61m for a 1052 square metre Farm Source store in Matamata at a 6.6 per cent yield.
In nearby Morrinsville, a 1043sqm store on Thames Street, sold for $2.305m, at a 6.6 per cent yield.
A Ngatea store went for $1.95m and the lowest yield of 6.4 per cent.
The 596sqm store sits on a 4555sqm site at Orchard West Road Ngatea.
A Fonterra farm source store in Ngatea went for $1,950,000 at an auction.