DNZ sells vacant land in Tauranga

Listed property investor DNZ is drawing praise for selling land. Photo / Bay of Plenty Times

Listed property investor DNZ is drawing praise for selling land.

Buffy Gill of Goldman Sachs praised DNZ's sale of vacant land at its Tauriko Industrial Estate in Tauranga, with settlement last Friday.

"The lots sold are 105 and 107, and have been sold at the 2010 book value of $1.3 million. This now leaves $2.365 million of vacant land at the Tauriko property, consisting of lots 82 through to 85," she said.

"These remaining lots are all in a single block, meaning that they could either be developed as a single property or sold in a single transaction.

"This sale of non-income producing land is another small yet positive incremental achievement by DNZ, which improves the earnings and distribution profile of the vehicle. We estimate the paydown of debt with the sale proceeds will be 0.5 per cent EPS accretive from next year onward.

DNZ is trading about $1.25 and has a market capitalisation of just $305 million on a portfolio of properties valued at $800 million.

Last week DNZ said it had extended a lease with Lion Nathan.

The 21,000sq m Springs Rd facility in Auckland's East Tamaki is one of New Zealand's largest liquor packaging and distribution operations with Lion Nathan occupying the whole site, DNZ said.

The lease to Lion Nathan is for three years from October 1 with fixed annual rent reviews, and an additional three-year right of renewal from October 1, 2014, DNZ said. Anne Gibson