Strategic industrial on 8-year lease
A high-profile industrial property on Auckland’s Great South Rd is for sale with a new eight-year lease including locked-in annual rental growth.
The 3962sq m property, at 738-742 Great South Rd, occupies a commanding position by the corner of Station Rd, Penrose, giving it huge exposure to some 30,000 passing cars each day.
It is for sale with a new lease from settlement to vehicle importers City Motor Group. Final expiry is 16 years from settlement including an eightyear renewal.
The bank-guaranteed lease returns $326,320 in net annual rent, with annual rent increases fixed at a 2 per cent.
The property also offers redevelopment potential, with low site coverage of only 12 per cent allowing a new owner to make the most of the site’s profile.
Colliers International has been appointed to market the property for sale by auction at 11am on Wednesday, December 4, unless it is sold earlier.
Industrial director Hamish West says it is an exceptional opportunity for investors to finish the year strongly by securing a true trophy asset.
“This property comprises a modern warehouse and office building with a substantial secured asphalt yard area and a large double-sided billboard.
“The improvements benefit from 135m of road frontage to the busy Station Rd intersection, providing huge exposure.
“The quality of the property is matched by the strength of its tenant covenant and favourable lease terms.
“The long lease is backed by a bank guarantee and boasts fixed rental growth every year, making it a very solid investment.”
Motor1, which trades as City Motor Group, was established in 2000. In that time it has sold some 30,000 vehicles and bought five properties for the business, all in the Penrose area, as well as leasing a nearby reconditioning facility with storage for 120 vehicles.
Its CEO Mark Lewis says the site for sale holds around 140 vehicles and has 16 staff. “We acquired the site because it provided many benefits for the business — a high profile site, high traffic flow, central Auckland location, and easy access from the motorway. Whoever buys this property will enjoy these benefits going forward.”
Industrial director Paul Higgins says the property is located across several titles in the heart of Penrose. “The Penrose/Onehunga area is an economic powerhouse, generating around 18 per cent of Auckland’s GDP.
“It is Auckland’s second highest area for employment and predicted to see a big increase in heavy truck access as the Auckland economy grows.
“Access to key transport infrastructure is very good, being only 800m from the Ellerslie-Panmure motorway interchange, 400m from the Penrose train station, and less than 10 minutes’ drive from the State Highway 20 interchange in Onehunga.
“This provides excellent access to the airport and both the harbour and inland ports at the CBD and Wiri.”
Industrial associate director Ben Cockram says the Business Light Industry property has 596sq m of improvements plus 2700sq m of sealed yard space.
“The 368sq m warehouse is constructed of a concrete floor, clear span steel frame, full height precast concrete walls and long-run steel roofing. It is accessed via four roller doors and has a stud height of 5.95m rising to 6.5m.
“A 45sq m low stud workshop at the rear of the warehouse is accessed by a single roller door. The 77sq m ground floor office comprises an open-plan area with an adjoining smaller office, toilets and staircase to the first floor.
“The 106sq m first-floor office sits above the low stud workshop and ground floor office.”