With a shortage of industrial-zoned land in the Wellington region thwarting the expansion plans of businesses and throttling the emergence of much-needed new property stock, the decision by one of New Zealand’s most proactive industrial property investors to sell a large tract of land in Seaview has prompted early interest from potential buyers.
Property for Industry (PFI), an NZX-listed property vehicle focused on the industrial sector with a portfolio of quality assets around the country, heavily-weighted to the Auckland region, is selling one of its four Wellington properties as it refreshes its investment strategy.
The freehold multi-tenanted industrial property held in one title at 48 Seaview Road, Lower Hutt, has significant surplus land suitable for development, elevating the property’s credentials in a hamstrung market.
The 13,464-square metre total site is only around 50-percent developed, leaving 6,000 square metres of blank canvas to play with.
Located on the western side of Seaview Road, close to the gateway roundabout to Wellington’s largest industrial precinct Seaview-Gracefield, the landholding supports two substantial main modern warehouse/office buildings and a truck stop with 150-metre road frontage.
The occupied components of the site are leased to long-term multi-national tenants: BP Oil NZ Limited, Bridgestone NZ Limited and Multispares NZ Limited.
However, it is the easily-accessible vacant land to the south and middle of the site that holds development potential for a well-resourced new owner prepared to either initiate a project to optimise the land footprint, or offload portions through a mini subdivision according to salespeople handling the sale.
Fraser Press and Grant Young of Bayleys Wellington Commercial are marketing the property via a tender process closing 4pm Wednesday 8th December.
Press said the rarity value of this strategically-located freehold industrial property in the coveted Seaview precinct is not lost on Bayleys’ extensive investor database.
“Fair to say the phone’s been busy since we launched the property to the market in the first week of November,” he said.
“There’s always a scramble for industrial assets in the Seaview-Gracefield area as evidenced by recent strong results attained by Bayleys for two high-profile properties in the precinct back in August.
“There’s a credible net income stream here of $385,571pa + GST per annum and a weighted average lease term of 6.5 years – however, what price do you put on 6,000 square metres of yet-to-be-developed land that comes with the property?”
The two main buildings constructed in 2008 and 2011 and at 100 percent new building standard, both offer A-grade warehousing, office and amenities, sealed yards and generous parking. These are occupied by Bridgestone and Multispares.
The adjacent BP truck stop fronts Seaview Road with a drive-through yard and diesel pumps accessible from two sides.
The land is zoned Special Business and Press said with the existing leases benchmarked to the consumer price index and therefore having built-in rental growth, the secure cashflow will allow a new owner to pursue redevelopment or subdivision options with confidence.
“The BP truck stop has an expiring lease which provides additional opportunity,” he explained.
“Having prime industrial assets blended with vacant land certainly gives options – whether that’s creating further large industrial improvements or smaller industrial type business units, keeping the existing developed component and subdividing off the land or vice versa.
“With minimal industrial vacancy across the region, and particularly tight fundamentals in the Seaview area, this property opens up numerous scenarios for switched-on investors and developers.”