Big Penrose site with solid tenant

The warehouse and office property, tenanted by Hirepool, at 818 Great South Rd. Photo / Supplied

A prominent corner warehouse-and-office property tenanted long term by Hirepool, New Zealand's leading equipment-solutions provider, is being offered for sale at 818 Great South Rd, Penrose.

Returning $245,000 per annum, the 2340sq m industrial facility is marketed by Andrew Hooper and Hamish West of Colliers International with offers closing at 4pm on July 27 unless sold prior to the auction.

Colliers is selling the property on behalf of a private family trust that is seeking to redeploy cash into another investment and Hooper says the sale provides a strong investment opportunity for the right buyer.

"The purchaser will secure well-located real estate consisting of a generic office and warehouse building that has wide appeal with excellent motorway links and profile to Great South Rd," he says. "The tenant is a well-known nationwide New Zealand business in an improving industry and the rent cannot reduce due to a hard ratchet clause."

The building was erected in the 1970s and has a total lettable area of about 2340sq m.

"This is a substantial high-stud warehouse building, complete with associated offices and amenities, on an unbeatable 4330sq m corner site. It is immediately opposite Hirepool's main Auckland facility and has been leased to the company since 2006."

Hooper says the initial 10-year lease term is due to expire on November 30, 2016, with two further five-year rights of renewal taking final expiry out to November 30, 2026.

"The next review is due on December 1, 2012. This is not based on CPI but is instead a review based upon market rentals, featuring a hard ratchet clause so that it cannot be less than it is currently."

The property is located in the northern corner of Great South Rd and Holloway Pl, virtually midway between the Panmure-Ellerslie Highway interchange to the southern motorway and the motorway link to Great South Rd. "Penrose is a proven and popular industrial area," says West. "Two significant developments are happening in the area, including one at 525 Great South Rd, and the limited vacancy in the area is reflected in the few properties for sale.

"Our latest research reveals that industrial confidence is at a multi-year high. The company's most recent quarterly confidence survey, which was published in June, showed that Auckland industrial-investor confidence has risen to 47 per cent, the highest since the survey began in March 2006. "The industrial sector is leading the way, consistently out-performing retail and office sectors."

West says a significant feature of the property for investors is the strength of the tenant. Hirepool employs 450 staff and has more than 50 branches nationwide.