A cold store complex with scale and leased long-term to the world’s number one cold store supply chain company is for sale in Hawke’s Bay with the property’s fundamentals underpinned by an active regional economy founded on the primary sector.
The property in Kirkwood Road, Twyford, Hastings, is located within Hawkes’ Bay’s leading food production precinct.
It is fully-tenanted by Lineage Logistics New Zealand Limited, the company which last year acquired the Emergent Cold business operations throughout New Zealand.
Lineage Logistics New Zealand Limited is a wholly-owned subsidiary of United States-based Lineage Logistics LLC, the largest cold store supply chain company in the world. The acquisition of Emergent Cold’s operations around New Zealand greatly expanded Lineage’s Asia -Pacific footprint in the cold storage market.
It has a 16-year lease term with eight years remaining and two further six-year rights of renewal, along with two-yearly rent reviews benchmarked to the consumer price index.
It is a net lease returning an income of $688,742 per annum plus GST and outgoings, with the tenant responsible for plant maintenance and replacement.
The Kirkwood Road property comprises 10,558sqm of buildings – assessed at 70 percent new building standard overall – on a flat, accessible 1.5 hectare site zoned General Industrial.
The buildings were constructed in the 1990s and there have been significant upgrades in subsequent years. The complex includes high-stud refrigerated storage warehousing, drive-in blast freezers and chillers, a refrigeration plant and machinery room, along with staff amenities and offices.
Rollo Vavasour of Bayleys Hawke’s Bay is marketing the property by way of deadline private treaty closing 4pm Thursday, 25th March (unless sold prior).
Vavasour said there is an identified shortage of cold store space globally and in New Zealand, and, as a defensive asset class, it’s very much in demand.
“Cold storage facilities were thrust into the spotlight by the COVID-19 pandemic, when food supply chains nationally and internationally were disrupted.
“More than ever, people needed to have confidence that the food they were consuming had been safely processed, stored and transported with a high level of integrity maintained right along the supply chain.
“Cold storage facilities have been held up as example of a resilient quiet achiever in this chain and increasingly, investors are recognising the value of purpose-built assets close to production hubs.”
Vavasour said the Kirkwood Road property has an established reputation in the Hawke’s Bay marketplace as a reliable and convenient facility that has provided tangible value to some of the region’s most prolific food producers.
“Hawke’s Bay is dubbed ‘the fruit bowl of New Zealand’ and when the inherent quality of Heretaunga Plains’ land is combined with high sunshine hours and enviable artesian water supplies, it’s easy to see why the region is one of the most productive in the country.
“The Hawke’s Bay economy is reliant on the primary sector, with quality, well-maintained industrial properties that directly support this activity being highly sought-after.
“The fact that a global giant in the cold storage arena, Lineage Logistics, recognised the value in acquiring an established cool store company with a large presence in the Bay adds weight to the offering in Kirkwood Road.”
Vavasour adds that while the property has an established lease in place for the foreseeable future with the processing of vegetables and fruit its prime function, the facilities on offer would transition well to other food-related operations such as convenience meal preparation, or meat/smallgoods processing.
The property’s primary sector-related neighbours include Bostock New Zealand, Sacred Hill Winery, McCain Foods NZ Limited, Wineworks, and Profruit Limited.
Kirkwood Road has easy access to the Napier-Hastings expressway – an arterial to the Port of Napier which is the country’s fourth largest port by container volume.