Bunnings’ No.2 store comes on to market
Bunnings Warehouse’s secondlargest New Zealand store, on a sprawling 2.2ha site at 2-12 Titirangi Rd, New Lynn, is for sale.
The property 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, cafe, offices, canopies and inward goods area.
It sits on 22,096sq m of freehold, Metropolitan Centre-zoned land that includes generous undercover customer parking.
The store services the highgrowth catchment of New Lynn and was purpose-built for Bunnings in 2014.
Bunnings New Lynn is being offered via an international expressions of interest campaign, closing at 4pm, Wednesday December 6, 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 standout 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 in the sector and assets typically sitting on sizeable and highly valuable land, which is underutilised by the landowner.”
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 Ltd are approximately halfway through their initial 12-year lease with further rights of renewal lined up,” says Davies.
“This gives the buyer income security from a robust multi-national 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 per cent over the last two years compared to the run we experienced from 2020 to 2021.
“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.
JLL metropolitan sales co-head 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 seeing the emergence of new capital sources that have identified genuine value in this sector.”