Auckland, 22 March 2014 - One of very few, if not the only, available freehold warehouse facilities of Grade A quality, size and scale in the Auckland Airport precinct has come up for sale at 129 Pavilion Drive.
Marketed by Claus Brewer, Scott Soroka and Bruce Catley of CBRE New Zealand, the property is for sale by way of Deadline Private Treaty, with a closing date of Friday May 9 2014 if not sold prior.
Claus Brewer says that the property, which was purpose-built for a global logistics company, offers an exceptional opportunity to acquire and occupy a high quality building in Auckland’s pre-eminent industrial precinct.
“Opportunities to own facilities of this size and quality in this location are extremely scarce, particularly as leasehold occupation is the norm at Auckland Airport. Freehold properties of this type and location are held in only a few hands: they are hardly ever sold. Therefore, most occupiers would have to endure a build period to secure this sort of quality.
“The property will therefore appeal to a range of owner occupiers and investors who will enjoy the flexibility to invest, occupy or lease it out. In addition, not only is it an excellent high stud facility with drive-through access to Pavilion Drive and Montgomerie Road, but it is also on two titles with dual street frontages, which offers further options for an investor or owner occupier to create two separate facilities on the site.”
Scott Soroka says that the building’s impending vacancy is also central to its appeal. “129 Pavilion Drive is available with vacant possession no later than the end of July 2014. There is nothing of this size ready and available now on the market. In addition, everything else spec built of a large nature this year will only be available for lease.”
Bruce Catley says that this combination of factors, plus the low interest rate environment, has driven “strong early interest” in the property from a number of investors and large occupiers.
“The cost of funding a purchase of this sort is still favourable versus rental cost. With projected rate increases it would still be more affordable for a well-capitalised occupier to own rather than lease the equivalent building. This is especially relevant when you factor in the diminishing supply of freehold industrial land, the quality of construction, cost, time and risk of a new build. These factors would justify the purchase on a replacement cost basis alone.
“Having transacted more than 200,000sqm in the last 12 months, we are confident that this property is right up there with the best to come to market. Over the last two years, CBRE’s transactional activity in the airport precinct has been at the leading edge of agency activity. Our dominant position in that market and knowledge of current occupier requirements means that we are confident that 129 Pavilion Drive will appeal to all active owner occupiers, investors and tenants.”
Occupying two Business 5-zoned freehold titles that total 18,407sqm, the 11,850sqm facility was built in two phases between 2006 and 2007 by Mt Wellington-based industrial building specialists Savory Construction.
The 10,341sqm warehouse has a stud height of approximately 9.5 metres to the knee, rising to approximately 10.6 metres at the apex.
Soroka says that the land was acquired and the building designed for maximum operational efficiency. “Built from the ground up for a logistics company, 129 Pavilion Drive is a full drive-through facility that has superb truck access with an excellent yard, a large 1279sqm canopy orientated away from prevailing winds and roller doors along the north-western side of the warehouse.
“Not being a head office means it has low office content, with a 115sqm ground floor office and similar-sized space on the first floor. However, as the building was originally consented to allow for a head office, it does have the potential to add space to enable occupation as a head office.”
Under the Proposed Auckland Unitary Plan notified on 30 September 2013, the property is proposed to be zoned “light industrial”, which includes light manufacturing, production, logistics, storage, transport and distribution activities.
129 Pavilion Road is located in the Airpark 2 subdivision within the airport precinct. Offering access to both Pavilion Drive and Montgomerie Road, it offers easy access to Auckland International Airport and State Highway 20 says Brewer.
“Airpark 2 is a relatively new industrial estate developed in the mid-2000s. It is a modern and upmarket industrial estate containing a number of high quality industrial buildings. The precinct is dominated by large-scale, predominantly industrial premises with attached office components.”
He adds that as it is only 1km from the Auckland Airport and 30 minutes’ drive from the Auckland CBD, the location is easily accessed from all directions via major traffic arterial routes.
“Because it is only a short distance from the airport, providing easy access to Auckland and the wider region, Airpark 2 is a popular industrial area that is home to many of Australasia’s largest logistics and customs companies.
“With the completion of the $1.4 billion Waterview Connection project envisaged for 2016, the importance of the airport location is only set to increase. Improved links between SH1, SH20, SH16 and the Upper Harbour link mean that the airport is fast-becoming Auckland’s focal point for logistics and labour.
“In addition, the airport is coming on in leaps and bounds in terms of its amenity and offering, which has further enhanced the location as a place to do business.”
“The current levels of vacancy in A grade facilities that are comparable to 129 Pavilion Drive, plus the supply due to come on stream in the balance of 2014, gives us great confidence that there is going to be strong demand for properties of this quality in this location.”
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (in terms of 2013 revenue). The Company has approximately 44,000 employees (excluding affiliates), and serves real estate owners, investors and occupiers through approximately 350 offices (excluding affiliates) worldwide. CBRE offers strategic advice and execution for property sales and leasing; corporate services; property, facilities and project management; mortgage banking; appraisal and valuation; development services; investment management; and research and consulting. Please visit our website at www.cbre.com.