Mt Wellington site ticks all boxes, says realtor

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A Mt Wellington warehouse and office property at 6 Hotunui Rd, up for auction, is ideal for investors seeking to diversify into the industrial market, say Andrew Hooper and Hamish West of Colliers International.

The 1800sq m freehold property is due to go under the hammer at 11am on August 15 in Colliers' offices at 151 Queen St, Auckland, unless it sells before the auction day.

"A combination of factors makes the property everything investors tell us they are looking for," said Hooper.

"It has a rateable value of $1.4 million, with a successful national business in occupation for the past six years and an annual income of $123,260 a year, backed by a personal guarantee," he added.

"We expect this property to appeal to a wide range of buyers, especially considering the scarcity of this type of investment and its dollar value. We're not aware of many other comparable industrial investment properties in this price bracket available on the open market in South Auckland at the moment." The property comprises a 556sq m medium-stud warehouse constructed in 1986, with 441sq m of air-conditioned offices and amenity areas, making up a total building area of nearly 1000sq m with 26 off-street car parks.

It is on Business 5-zoned land in central Mt Wellington, next to the well-known Tip Top building.

The offices have recently undergone significant refurbishment at a cost of around $170,000, Hooper said.

"They now have a great modern look and feel, with plenty of natural light due to the extensive glazing around two sides of the front portion of the building."

The warehouse features roller door access and a hardstand yard to one side, providing space for truck and container movements.

The property is leased to Arneg New Zealand with rent reviewed to market every two years and the next review due in October 2013. The company has occupied the Hotunui Rd property since 2006 and has over five years remaining on its lease term.

According to Arneg NZ's website, the company is a 100 per cent owned and operated New Zealand business which supports users of commercial and industrial refrigeration around the country. The company also has the benefit of being part of the Arneg World, with operations in 25 countries and manufacturing in 14, the website states.

John Bowring, Colliers International's national auction manager, says the property is in a price bracket in which industrial properties with strong investment fundamentals are not commonly found.

"The bulk of property investments of this value are either unit title retail holdings or syndications. With investment property in such high demand among investors across all commercial property sectors at the moment, this freehold title should not be overlooked as industrial buildings of this size and quality are extremely scarce.

"This is a great little bottom drawer earner and a conservative investment holding for a wide range of investors seeking diversification."

West says the property's location is arguably Auckland's most popular industrial area.

Combined with its functionality and size it is ideal for a large number of medium-sized industrial occupiers and should therefore always be easy to let should a vacancy arise in the future.

"Mt Wellington is in constant demand among manufacturers, importers and distributors due to its central location halfway between Auckland's CBD and port and Auckland International Airport," he said. "It is a very tightly-held area with a short supply of properties, so those that do come on to the market are generally leased very quickly.

"The property is on a quiet cul-de-sac with excellent motorway access via the south eastern arterial and also State Highway 1 to Auckland's CBD and south to Manukau."