Big Box Thinking
As a third generation industrial property pundit, Hodge says it’s time for that sector to really shine.
“Large industrial properties have become our sweet spot – we own around 70,000sqm of industrial property across seven buildings in the city. That’s a lot of sheds,” he says.
Originally from Dunedin, Hodge worked offshore for a time before ending up in Wellington where he now considers himself a local.
“I reckon I’ve served my apprenticeship in the capital – yep, basically I’ve become an overnight success in 30 years,” he laughs.
He modestly agrees that the company has played a part in revitalising the industrial scene in Wellington. As one of the region’s largest privately-owned property investment and property management companies, Hodge Group has stamped its mark on the sector.
“We’re long-term players in the Wellington market, our portfolio is fully-leased and we’ve had impressive rental growth” he says.
“New Zealand is a small marketplace and this game is all about reputation. In the past, industrial property was considered the poor cousin to office property and historically, the industrial sector attracted owner-landlords that did not bring professionalism and a high level of care to the property table. “I think Hodge Group’s point of difference has been to raise the industrial bar by investing in significant industrial property stock, presenting it well, ensuring that it functions effectively and ultimately, attracts some of Wellington’s best industrial-use clients.”
Hodge Group’s latest project has been the redevelopment of the former Te Puni Mail Centre on The Esplanade, Petone, anchored by home improvement chain, Bunnings Warehouse.
The prime 2.3 hectare waterfront site has benefited from District Plan change 29 which created zoning flexibility at the western end of Petone leading to growth and diversity in the area.
“The site was bought with the knowledge that its best and highest use was big box retail,” says Hodge. “That sector is flourishing in Petone with proven heavyweights like PAK’nSAVE, the Warehouse, Kathmandu, Kmart, Briscoes and Rebel Sport all cementing a successful presence in the neighbourhood.
“Prior to this consolidation, the big box sector was fairly fragmented across the region with bits and pieces near the airport and the rest in Porirua.
“I maintain that Petone has grown ‘the industrial pie’ in a region where there is fairly limited opportunity because of the lack of flat land for industrial development.”
Hodge Group also owns a further 12,000sqm of land at the western end of Jackson Street which is currently in industrial usage but is earmarked for conversion to additional big box stock.
Hodge says seismically, industrial buildings have proven to be pretty bullet proof.
“We’re acutely aware of building standards and the importance of structural integrity given that Petone is located near an identified fault line. Our building stock came through the most recent earthquake unscathed so we’re thankful for that – as are our tenants.”
Petone has an industrial heritage with meat works, woollen mills, railway workshops and car assembly plants defining the area until the 1980s. The gradual gentrification of the suburb and the emergence of Jackson Street as a boutique retail destination may seem at odds with major big box development but Hodge says the two can – and do – coexist happily.
“The big box precinct acts as an anchor at the end of Jackson Street. It certainly draws shoppers from across the region and boosts awareness of Petone as a retail hub.”
As a born and bred mainlander, Hodge says he’s happy that his family calls Wellington home.
“I think it’s an exciting place with a cosmopolitan vibe. We live, work, and play here – and love it,” he says.
“You can traverse the city in 35 minutes without the infrastructural pressures and constraints that Auckland has, so that’s a plus in my book.
“And while everyone likes to have a dig about the wind, having an international airport means that when the going gets tough, the tough can get going.”