Countdown puts supermarkets on the market
Giant supermarket operator Woolworths New Zealand has put its Papakowhai and O¯ rewa supermarket properties on the market as it reports surging sales at the checkout.
The Australian-owned and listed supermarket business, which owns the Countdown branded supermarkets in New Zealand, has earmarked for sale the Countdown supermarket buildings and land at O¯ rewa, north of Auckland, and likewise Countdown Aotea at Papakowhai in the Porirua district.
The freehold land and buildings have new 10-year leasebacks to Countdown with rights of renewal to extend Countdown’s occupation until 2080.
The two can be bought individually or together.
They have a total net income of more than $2 million. The deadline for the sale by tender is August 6 and Bayleys is marketing the supermarket properties.
The property sales come as Woolworths New Zealand, the country’s second-largest grocery business behind Foodstuffs, notches up double-digit rises in New Zealand food sales in the first half of this year.
New Zealand food sales rose
13.7 per cent in the third quarter, January through March, compared to the same months the year before, and in the fourth quarter, April to mid-June, New Zealand food sales were 15.1 per cent higher than the year before, Woolworths Group said in a trading update to the Australian Stock Exchange.
Porirua’s Countdown Aotea opened in 2017 on former caravan park land. The purpose-built property was bordered by residential homes to the north, east and south, Bayleys said.
Countdown O¯ rewa opened in
2014 after Progressive Enterprises, now Woolworths New Zealand, bought an existing supermarket in O¯ rewa in 2011, with additional land and buildings, and developed the property.
Countdown O¯ rewa is 200 metres from the beach, and Bayleys said the 9380 square metre site had development potential, as the zoning permitted mixed-use residential development up to a height of
18 metres.
Bayleys national director of commercial and industrial, Ryan Johnson, said there were buyers in the market for properties with scale and strong lease covenants.
With Woolworths New Zealand, a committed tenant, the lease covenant on the two properties was ‘‘as good a lease covenant as you can get’’.
‘‘Negative after-tax real returns from money held in the bank has seen more than $7 billion withdrawn from bank term deposits recently, so there’s plenty of investment money rattling around looking for returns with strong underlying fundamentals,’’ Johnson said.
Woolworths New Zealand owns and operates more than 180 Countdowns in New Zealand and is one of the country’s largest private-sector employers. It has
20,373 staff across its supermarkets, distribution centres, processing plants and support offices.
‘‘There’s plenty of investment money rattling around looking for returns with strong underlying fundamentals.’’ Ryan Johnson
Bayleys national director of commercial and industrial