Hard-working Drury property with rental upside
Units 1-4, 16 Norrie Road, Drury
• 6,710sqm site – four unit titles sold as one lot
• Total 973sqm buildings split across four tenancies
• Good yard space and off-street parking for each tenant
• Net income $71,730.55pa plus GST and outgoings
• Deemed under-rented given market fundamentals
• Close to Great South Road and the Drury motorway interchange
• National Total Property marketing campaign – for sale by auction
• Strong enquiry levels from investors on Bayleys’ databases and directly off the Total Property magazine
• More than 100 enquiries, mainly from South Auckland and wider region investors
• SOLD for $3,160,000 – at a 2.26 percent yield
• Purchased by a South Auckland-based investor
When this Drury property hit the market, agents Peter Migounoff and Piyush Kumar of Bayleys Papakura readied themselves for an influx of enquiry as they knew it was exactly the type of property that investors were hunting for.
With returns from the industrial property market continuing to outstrip those of other asset classes and Drury seeing feverish demand as development activity progresses, this property resonated with investors looking to leverage off the growth fundamentals in the area.
Peter said Drury is going great guns right now and this fully-tenanted industrial property with its Business-Light Industry zoning is sought-after by trade and services’ businesses wishing to be close to greater South Auckland and in particular, to the evolving Drury area.
“This is a classic split-risk investment asset with four tenancies, including respected civil contractors Farmer Construction,” he said.
“As it currently stands, the property is under-rented when benchmarked against market rates so there is potential for the new owner to address that over time.”
Peter said initial feedback from the marketing campaign was that the property sat around the $2.5 million mark, but he was hopeful that competition could push that to $3 million.
“The room was packed with bidders on auction day and we had a further 10 bidders on the phone,” he said.
“With an opening bid of $2 million, spirited bidding drove the price to $3,160,000 at the fall of the hammer – a fantastic result for our vendors and a reflection of the supply-demand factors at play in the current market.”
Vendor Steve Selkirk said the strong industrial property market and the shortage of available stock was behind the decision to sell.
This property had been in Steve’s family’s ownership for 15 years prior to him buying it from them five years ago.
“I’d subsequently been watching the market and decided that now was a good time to sell given the growth in the Drury area, and the strength of the industrial property market,” he explained.
“I wanted to free up some capital for other uses and it was great to work with Peter and Piyush from Bayleys.
“They did an excellent job with the advertising of the property and with viewings for prospective purchasers – plus they dealt with any little hiccups along the way.”
After an action-packed session in the auction room, Steve said he was “rapt” with the whole auction process.
“We achieved the price we were hoping for and are very grateful.”
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