A straightforward passive investment opportunity on Gisborne’s commercial fringe could be the gateway into the market for first-time investors.

Occupying a 2,228sqm site held in three titles and zoned Outer Commercial, the property at 124-126 Disraeli Street, Gisborne comprises two functional industrial buildings with circa 600sqm of workable space across workshop, office, and storage, along with a generous yard. It is fully leased to three well-regarded trade-based tenants and delivers a diversified and resilient income.

There is a head lease in place to TW Construction, a national civil and construction contractor, with subtenants Super Chill Refrigeration, specialists in HVAC and refrigeration services, and Rocket Scaffolding, a multi-region provider of scaffolding and access solutions.

The property currently returns annual net income of $184,225 plus GST, with the head lease in place for a six-year term from March 2025. There are a further three, four-year rights of renewal and built-in rental growth.

Mike Florance of Bayleys Gisborne is marketing the property for sale by deadline private treaty, closing Wednesday 10 September, unless sold prior.

There has been little in the way of tenanted industrial stock on the market in Gisborne lately, with Florance saying landlords have been riding out economic flux.

“Owners have sat on their assets waiting for market fundamentals to improve, and as a result, there’s pent-up buyer demand for good quality, investment opportunities.

“The Disraeli Street area is an established light industrial/commercial precinct and the city-fringe location works well for a range of businesses, including trade-retail, which is increasingly attracted to the area.

“It’s a good part of town, and the subject property is a compelling investment opportunity given the locational advantages and cash flow from three well-known businesses.”

With the development sector expected to ramp up off the back of an improving interest rate environment, and measures by the government to open up the supply of construction materials to bring about cost efficiencies, Florance says the property’s existing tenant mix is a good fit for the asset.

“The occupiers are all active in high-demand service sectors which supports the rent roll and makes the property an ideal passive investment for new investors, or for a buyer looking to add to an existing portfolio with a no-frills asset.

“A very recent industrial sale conducted by Bayleys showed a 5.5 percent yield, which is pretty aggressive in the current market. Regional New Zealand is generally seeing an uptick in investment, and Gisborne represents decent buying.”

The wider area is home to a broad mix of local, national, and multi-national brands, including Woolworths, Mico, NZ Safety Blackwoods, Gisborne Honda, Subway, Pizza Hut, and PlaceMakers.