Strategically-located land and buildings in Taupiri
1 Railway Road, Taupiri. Sold 14th September 2017
- 986.35m² retail outlet and bulk store premises
- 3,948m² land
- onsite car parking
- Current eight-year lease to rural supplies provider Farm Source (previously known as RD1) runs until 2023
- Lease has 4x3yrRoR
- Buildings assessed at 80-90% NBS
- Annual rental $137,842 + GST/OPEX
- Capital Value - $530,000
- National Total Property marketing campaign with auction method of sale
- Sold under the hammer for $2,250,000 at a 6.12% yield
- 45 direct enquiries received
- 6 bidders in the room
- Sold to an Auckland investor who owns another commercial property in the area
Taupiri is a small rural township on the eastern banks of the Waikato River in the shadow of Taupiri Mountain – north of Ngaruawahia and 8.5km south of Huntly.
As with all rural townships, the rural supplies store is a focal point for the farming community. The property at 1 Railway Road, Taupiri, leased to Farm Source, attracted significant attention from investors when it came up for auction.
Josh Smith of Bayleys Waikato says buyer enquiry came from around New Zealand with strong interest from farmers looking for a passive investment opportunity.
“This property is your classic ‘hands-off’ investment – one that you can effectively put in the bottom drawer and collect the rent on,” says Josh.
“This is farming country and Farm Source provides an invaluable service for locals. It’s a key hub for rural suppliers to tap into the local market.
“The current lease, and renewals beyond, offered security for a new owner and as the building was in great condition, with good structural credentials, it had real appeal in today’s market.”
The vendors, with connections to the rural sector, opted to sell while the market was strong.
With business connections to the farming sector in the Thames-Hauraki Plains area, the vendors acquired 1 Railway Road, Taupiri, a couple of years ago seeing it as a solid investment in a thriving rural community.
Held as a straight investment property with a strong lease in place to Farm Source – a subsidiary of Fonterra Co-operative Group – the vendors recognised the robust demand for well-tenanted, well-maintained commercial/industrial property in provincial New Zealand and decided to move the property on.
“We saw it as a good time to sell given there was still a decent current lease locked in, and identified tenant commitment beyond that,” says one of the vendors.
“The result on auction day was what we’d hoped to achieve so we were happy with the outcome.
“Going into the auction we weren’t too sure what to expect as you’re in the hands of the bidders – but it played out well on the day.”
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