Big Porirua freehold industrial site

An aerial view of the large 1.9ha corner site for sale at 8 Hospital Drive, Wellington. Photo / Supplied

A large industrial development site next to Kenepuru Hospital in Porirua, is expected to be highly sought after by developers and owner occupiers.

"This is a prime site right next to the hospital, in an area that is set to benefit from transport improvements," says Kieran Lennon, industrial broker with Colliers International who, with colleague Tim Julian, is marketing 8 Hospital Drive for sale by expressions of interest closing on Tuesday March 7.

The site, comprising 1.9 hectares of prime freehold land, occupies a high-profile corner location on the corner of Hospital Drive and Raiha St, and has two road access points.

It located in the Kenepuru/Elsdon industrial area that was established in the 1960s and which is home to brand name occupiers including Bunnings, Whittakers, Bidvest and Online Security.

"There are few options to purchase well-located industrial land in Wellington and the new on and off ramp to State Highway One on the new Transmission Gully route will be just 650 metres from this property," Lennon says.

"There are now less than 100,000sq m of industrial space available in Wellington - well below the 9 per cent vacancy recorded in late 2012," he says.

Julian says the site is not due to be titled until around September 2018, so a purchaser could secure a contract over the site but not settle until that date.

"The lead-in time while the title is issued gives the buyer plenty of time to make their development plans ahead of settlement.

"By the time the site is titled, it will be ready to go, with services provided to the boundary and a load-bearing platform installed for construction."

Julian says the site will be filled and engineered under the supervision of Calibre Consulting to provide a load-bearing, level platform, with a capacity of between 50 kilopascals (kPa) and 100kPa suitable for an industrial building.

"The opportunity to construct a new industrial facility in a market where vacancy rates are very low is also expected to appeal to developers," he says.

"Colliers' latest research showed Wellington industrial vacancy has reduced to a record low of 2.9 per cent.

"This is the lowest vacancy rate in the industrial market for a generation, and is resulting in strong rental and value growth.

"Industrial property has been taken up quickly over the past few years, to the extent that there are now very few options available for businesses looking to move.

"This is due to stronger tenant demand and practically no new supply, along with a reduction in the number of industrial buildings in the market."

Julian says the supply of industrial space had become more restricted owing to a combination of factors.

These included some industrial properties being converted to retail use; new infrastructure projects getting underway; and a shortage of well-located land preventing developers from being able to construct buildings where tenants want them.

Kieran Lennon, Colliers International.

Tim Julian, Colliers International.