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Industrial warehouse for sale offers pipe dreams for new owner

The leasehold land and the building housing the Dunedin branch of a world-wide industrial pipe and tube retailer have been placed on the market for sale.

The property at 68 Sturdee Street in Dunedin’s Harbourside Basin Precinct industrial quarter is occupied by MRC Global – a North American-based company with operations in 100 countries.

Tenant MRC Global has been in the pipe and tube retailing sector for 99-years, and in addition to the Dunedin branch, has New Zealand locations in Auckland, Hamilton, New Plymouth, Wellington, Christchurch and Invercargill.

The corner site Dunedin property occupied by MRC Global features some 410 square metres of warehousing, retailing space, and offices, sitting on some 892 square metres of leasehold land.

The leasehold land and building at 68 Sturdee Street are now being marketed for sale by deadline private treaty through Bayleys Dunedin, with offers closing on October 21. Salesperson Muir Gold said the Sturdee Street property sustained MRC Global’s 290-square metres of warehouse showroom space, 50 square metres of office space and staff amenities, an additional 70 square metres of mezzanine level office and storage space, and came with 10 car parks for staff and customers.

MRC Global currently has a lease on the property running through to 2025 with two further five-year rights of renewal, generating net rental income of $37,765 plus GST per annum and with market-linked rental reviews regularly scheduled throughout the terms. The property has an annual ground rental of $16,056 plus GST per annum for the next seven-years, with the ground lease running through to 2041.

The head lease on the property is owned by Chalmers Properties Ltd which has just assigned a new 21-year ground lease to the site. Ongoing ground lease renewals run in perpetuity. Otago Regional Council and its subsidiary land administration company Chalmers Properties Ltd own vast tracts of land in the Harbour Basin Precinct.

Surrounding industrial premises around the MRC Global plant in Sturdee Street include roading and infrastructure firm Fulton Hogan, refuse and rubbish management company Waste Management, Steel & Tube, Dunedin Stainless Steel and Ritchies Transport.

Gold said the location’s dual entry and exit points allowed easy access for heavy vehicles off both Sturdee Street and Wickliffe Street – the main arterial route to the Harbourside Basin Precinct. Included in the building’s chattels is a heavy-duty gantry crane used for loading and rack stacking MRC Global’s selection of weighty steel piping.

“The high roller door within the warehouse portion of the building, along with good yard space outside, allows an efficient free-flowing traffic movement system to be utilised – which delivers greater customer efficiencies for the tenant and their business,” he said.

“With considerable construction projects in the pipeline in and around the Harbour Basin Precinct - such as the new hospital and the refurbishment of many older premises – the Sturdee Street location works well for MRC Global and the products it sells.”

Gold said Dunedin’s Harbour Basin Precinct was the city’s main industrial quarter and linked well to the all of the city’s arterial routes. The leasehold Sturdee Street site is zoned industrial under the Dunedin City Council 2GP P.

Constructed in 1995, the Sturdee Street building is constructed on a concrete floor pad, with tilt slab walls, steel beam framing, and full height sloping roof with Perspex panelling inserted along the roofline to allow for natural lighting.

The office space within the ground level and mezzanine portions of the building is predominantly open plan, while the retail showroom on the ground floor is also based on an open plan aisle format.

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