Absolute A-Grade industrial opportunity at 13 Ha Crescent
Absolute A-Grade industrial opportunity at 13 Ha Crescent
11 October 2014
Auckland, 11 October 2014 - At a time of real scarcity of high quality industrial facilities in desirable South Auckland locations, driven by strong interest and activity across the market, an A-Grade property has come up for sale at 13 Ha Crescent, Wiri.
Marketed by Paul Steele, Mark Bramwell and Scott Soroka of CBRE on behalf of Stevens Limited, the property is for sale by Deadline Private Treaty, closing 4pm on Thursday 30 October 2014 unless sold prior. Vacant possession will be available from February 2015, giving the buyer time to plan for relocation.
Paul Steele, Associate Director of CBRE, says: “This is an absolute A-Grade facility, a modern industrial property in one of Auckland’s most popular and fast growing industrial precincts. I know this is an often-used phrase, but it offers an extremely rare opportunity to acquire a building of real quality in an excellent location.
“There is very little stock available in Wiri at the moment. With fewer and fewer options around, all owner occupiers and investors wishing to own prime industrial real estate in the heart of Wiri and close to the motorway and inland port should take advantage of this outstanding market opportunity.”
“I cannot over-emphasise that good quality property in Wiri is extremely limited in terms of availability. There is nothing comparable for sale and very few opportunities to buy.”
13 Ha Crescent comprises a 7,786sqm freehold site with dual street access. The buildings cover an area of 4,996sqm, comprising a 3,671sqm warehouse with 10 metre clear span and three roller doors, plus 508sqm of office space and an 818sqm drive-through canopy area.
“This property offers an excellent level of specification,” says Mark Bramwell. “Its good stud height, large canopy and dual road access are only bettered by its convenience to the motorway. Also, the in-situ existing racking layout and mezzanine area could also be acquired by the purchaser, should they wish to do so.”
“Site coverage is approximately 64%, including canopy or 53% excluding canopy. The site provides generous car parking, manoeuvring areas and general site circulation.
Currently zoned “Quarry” under the Operative District Plan, with the proposed unitary plan listing it as “light industry”, the property has a frontage of approximately 63m on to both Roscommon Road and Ha Crescent, only 2 kilometres from the State Highway 20 on/off ramp, providing easy access to State Highway 1, Auckland Airport, CBD and the greater Auckland area.
Scott Soroka says neighbours include Croxley, Briscoes, Kiwi Steel and Cavalier Bremworth. “Ha Crescent is an established street in an up-and-coming industrial precinct. Much of the area was developed in the late 1990s and throughout the 2000s.
“The purchaser of 13 Ha Crescent will be surrounded by quality neighbours, which provides an opportunity to position their company as an equal and set the tone for their future. Neighbouring owners, such as 33 Ha Crescent, have been successful in obtaining permission to use their site for heavy industrial purposes, including Dangerous Goods storage.”
Soroka adds that Wiri has become the focus of modern development over recent times. “Land close to and around Roscommon Road has been rapidly developed. This has been driven by a number of factors including improved transport links and scarcity of industrial land supply within Auckland.
“Occupiers are relocating to Wiri to take advantage of the improved motorway links, which will only improve further once the Waterview Connection is completed, and The Wiri Inland port. The existing Wiri Inland port is currently used by around 19% of users, and is expecting a major increase in traffic with the opening of the rail link to the Port of Auckland this year.”
Paul Steele says: “This property can be clearly described as an A-grade facility in a market where there is a limited supply of this grade of stock. Most A-grade supply is controlled and owned by larger institutions who typically will not sell these types of assets, making this a rare opportunity for investors and owner occupiers.”
Steele adds that industrial yields in Wiri have firmed during 2014.
“The industrial sector has kicked into higher gear over the past 18 months. In the past quarter, rents have experienced growth significantly above other sectors. In Auckland’s prime industrial market, rents have risen substantially in the past two quarters and are now up 7.3% over the past year.”
“Prime industrial market yields are still firming, due to active investor interest amidst limited investment opportunities. Yields are being pushed by strong investor appetite and the banks have been keen to lend money, so there is a lot of competition now between owner occupiers and investors.
“The market is very tight, with not a lot of stock available for sale or lease, mainly because there has been strong take up during 2014 and new supply has struggled to meet demand. Investors are buying stock with income, and occupiers are buying empty buildings, with both essentially paying the same capitalisation rates.
“These conditions are set to last, because there is now a lot of pent-up post-election pressure for transactions to be completed prior to Christmas, which is traditionally a busy time.”
Vacancy in Wiri decreased in the six months to June 2014, with the overall vacancy rate for the suburb falling from 6.2% to 5.7%. Vacancy in Wiri is almost twice that in the rest of Auckland and currently represents around 18% of the total vacant industrial stock monitored by CBRE. This is largely due to the concentration of larger format warehouses in this area and the migration of businesses from B or C Grade stock into A Grade and new Design Builds. By way of example, Frucor Beverages recently moved into a new 17,000sqm Design Build and took their previous 16,000sqm building to the market.
The Wiri industrial market experienced positive net absorption in the six months to June 2014, with secondary grade properties having the greatest impact at positive 12,147sqm since June 2013, Prime net absorption was over 70,000sqm since June 2013.
Rental growth was observed along the quality spectrum in the Wiri market in the second half of 2014. Indicative net effective rents for Prime properties have increased around 4.4% on average since December 2013 and are currently assessed at $109/sqm. Secondary properties have increased to $79/sqm, reflective of a growth rate of 13.3% over the past 12 months. After a bit of a catch up, industrial rents in Wiri are now at similar levels to those generally within the wider Auckland region.
Overall, indicative industrial yields in Wiri firmed in the first half of 2014. On an annual basis, Prime yields have remained moved lower from 7.63% in December 2013, to 7.25% in June 2014. Secondary yields have firmed 75 basis points since the beginning of the year, and are assessed at 8.50%. Both Prime and Secondary yields are firmer than those on average across Auckland.
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (in terms of 2013 revenue). The Company has approximately 44,000 employees (excluding affiliates), and serves real estate owners, investors and occupiers through approximately 350 offices (excluding affiliates) worldwide. CBRE offers strategic advice and execution for property sales and leasing; corporate services; property, facilities and project management; mortgage banking; appraisal and valuation; development services; investment management; and research and consulting. Please visit our website at www.cbre.com.