As the shortage of industrial property in Wellington region-wide continues to drive rental rates up and create competition among investor and owner-operator buyers, agents active in the industrial sector say market fundamentals are unlikely to change until new stock across asset types emerges to ease pressures.
As with other properties in the wider commercial sector, well-tenanted buildings with long lease structures are attracting strong buyer interest and finding favour with lenders.
With the Wellington industrial market one of the tightest in the country, a Hutt Valley property for sale in Gracefield is receiving robust enquiry on the back of sub-1-percent vacancy rates in sought-after Lower Hutt precincts and the tenant covenant in place.
Sited on 5,713sqm land, the quality modern industrial offering with a total lettable area of 3,052sqm at 1D Quadrant Drive comprises a substantial high stud warehouse with ample yard and drive-around access, plus a well-appointed office and showroom to the front profile.
Start your property search
The tenant, respected New Zealand-owned and operated flooring specialists Arrow Matting Systems (AMS), operates its head office and New Zealand distribution centre from the site.
AMS is 18 months into a nine-year net lease with rights of renewal, personal guarantees and review mechanisms in place.
Paul Cudby, and Ethan Hourigan, Bayleys Wellington Commercial are marketing the property by tender, closing 4pm 2nd November.
Describing it as a “prime opportunity”, Cudby said it’s rare to find a Wellington industrial investment property today where all the real estate fundamentals line up.
“The tried-and-true formula of location, quality building, established tenant and long lease combine here and with the property currently rented below-market, there’s potential for future rental growth,” he said.
“Gracefield is one of the preferred industrial precincts in the region, and is home to some of the country’s business heavyweights.
“This functional building has features that give it broad appeal to occupiers and with the current tenant taking a nine-year lease with renewals, it clearly works well for their operation.”
The 2,422sqm warehouse has a substantial concreted yard to the front of the property with three roller doors allowing streamlined goods access, with additional yard area to the north side and rear creating drive-around access.
An additional roller door at the back of the property adds to the functionality of both the warehouse and the yard.
A purpose-built wind lobby to the front of the warehouse also serves as staff access to the warehouse, and as a courier pickup zone.
The 600sqm, single-level largely-open plan office area with quality amenities also has an entry wind lobby, along with double glazing, electric blinds, fibre internet, in-floor power and cable pods on a 5x5 metre grid, and a high quality, multi-zoned HVAC and fresh air system.
Cudby said there is still good investor appetite for industrial property around the region, with Lower Hutt’s central location and convenient arterial access giving it enduring appeal.
“The vacancy levels remain historically-low and properties with any scale are increasingly hard to secure in the Hutt.
“Established players in the market are snapping up the big sites and locking in long-term leases, as AMS has done in Quadrant Drive.”
AMS was founded over 35 years ago, and has grown substantially to be a leading provider of safety flooring, and other flooring systems for domestic, commercial and industrial use.
