Investors plugged into opportunity over lockdown
176-178 Station Road, Penrose, Auckland
- Redesigned and refurbished 950sqm industrial trade/retail building with 22 car parks
- Includes new tilt-slab warehouse designed specifically for the tenant, Ideal Electrical
- Located on a high-profile main arterial
- 1,622sqm site held in two titles
- New 10-year lease with 2x5yr RoR and net rental of $266,780 per annum
- Zoned business-light industry
- Grade A NBS
- National Total Property marketing campaign – originally to be auctioned, but because of COVID-19 interruption, became a multiple offer situation
- Strong enquiry levels from investors on Bayleys’ databases and via other marketing avenues
- Two unconditional offers received during lockdown brought the sale date forward
- SOLD for $5,300,000 at a 5.03% yield
- Purchased by a family trust
The recent successful sale of this fully refurbished and redeveloped industrial property in Auckland was testament to the power of good communication and due process, on the back of a disrupted marketing campaign thanks to COVID-19 lockdown restrictions.
The Penrose property was an “as new” offering that had been reconfigured and extended for the tenant, Ideal Rexel Group, trading as Ideal Electrical New Zealand – one of New Zealand’s largest electrical trades-supplies companies.
Marketed by James Valintine and his colleagues James Hill and Sunil Bhana of Bayleys Auckland, the property boasts showroom/trade retail, small administrative offices, staff lunchroom and amenities along with a brand new rear warehouse purpose-built for the current tenant.
“The partnership approach to the redevelopment of the property undertaken between the vendors, Total Property Worx, and the tenant means this site has been effectively future-proofed for the tenant business – reflected in the long-term lease arrangement,” explains James Valintine.
“We knew this would be a popular offering for passive investors seeking good income from a quality, well-located property, but New Zealand’s lockdown scenario put a bit of a spanner in the works and meant our marketing plan was disrupted.”
James says they continued to go out to their databases advising potential investors of the opportunity and in turn, several people who had viewed the property prior to lockdown actively pursued agents with a desire to buy the property.
“We received two unconditional offers in writing which brought the revised marketing campaign close date forward,” he says.
“The property was sold to a family trust looking for return on investment that simply is not available by putting money in the bank today.”
One of four private investors that owned the property, managing director of Total Property Worx (TPW), Paul Southam, says not even a global pandemic could derail the marketing train for this quality property.
The redevelopment and refurbishment of the Penrose property was undertaken and proudly completed by Paul and his team and is one of numerous industrial projects that the reputable construction and commercial project management company has completed in wider Auckland.
“It was great to be able to create a functional and adaptable base for Ideal Electrical – one that should work for them well into the future,” he says.
“Our investment group had intended to hold this property for the longer term, but we identified some other business opportunities and decided to release some capital to pursue those,” he says.
The decision to list with Bayleys and take the property to auction was seen as smart – particularly as the industrial sector was outperforming other asset classes, there’s a shortage of quality stock, the property was tenanted and presented essentially “as new”.
“Who could have known that a virus would get in the way of a well-planned and implemented marketing campaign which was meant to have culminated in an auction, though?” he says.
Paul says regular communication and sound liaison between agent, clients and potential buyers meant that they were presented with a couple of really robust offers during lockdown and a deal was done.
“A great result all-round”.
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