Big industrial landholdings beyond urban limits coming on to the market

Earlier this year, Auckland Council principal adviser David Taylor cautioned that based on historic land take-up rates, the region would begin to run out of available vacant industrial land within the next 10 years if there was no further new land provided.

His report’s findings were endorsed by Auckland councillor Cameron Brewer, who said that the council’s earmarked future industrial land was “nowhere near enough to satisfy the insatiable thirst for more land from the Bombay Hills to Wellsford.”

Bayleys national commercial and industrial director John Church says the identified, significant shortage of sites bigger than five hectares is creating a challenge for developers, owner/occupiers, and prospective industrial tenants who, based on forecasts, would see the opportunity for growth in the wider Auckland region but are constrained by lack of land.

“While we await word on further largescale industrial rezoning to plug the foreseeable gaps that many have identified and expressed concern over, there are still some reasonable-sized pockets of industrial land around – if you know where to look for them,” Mr Church says.

“We are proactively talking to land owners across the region particularly where future growth dynamics are at work and there are some interesting opportunities trickling on to the market.

“As part of our latest Total Property campaign, there are select industrial development sites for sale scattered from South Auckland to the northwest.

“Lateral-thinking owner/occupiers and developers are eyeing up these opportunities around Greater Auckland’s urban fringes to see how they can best secure a foothold in some of the region’s emerging locations, which are underpinned by infrastructural improvements and growth trajectories.”

An 8.7ha site in Waiuku, a four-hectare block in Takanini and six industrial lots near Kumeu have made their way on to the market.

In Waiuku, 63 kilometres from the central city, 8.7388ha of industrial/industrial services rezoned development land within the Fernleigh Business Park is for sale. It is being pitched to owner/occupiers, developers and landbankers with an eye on future growth patterns.

“Waiuku is going ‘gang-busters’ at the moment. Those developers and owner/occupiers who are getting priced out of more central Auckland markets are casting their net widely and finding that Waiuku comes up trumps – particularly on the affordability scale.

“Those industries that require large tracts of land are simply unable to find suitable sites in the traditional industrial areas, so emerging areas like Waiuku are finding favour.

“Bottom lines are important and while the tender process will ultimately sort out the value, we believe the per square metre rate will be temptingly within reach of many.”

Further north, a 4.155ha rectangular-shaped development site in Takanini, zoned industrial under the recently implemented Takanini Structure Plan 15, is for sale following a plan change that saw the parcel of land morph from a lifestyle block to an industrial opportunity.

The land was formerly zoned rural and is part of a 53ha parcel of land that was rezoned about 18 months ago. There is a four-bedroom home and shed on the site.

The seller was one of several landowners in the area who contributed to a plan change, which has seen this land form part of the mixed-use industrial zone at the northeastern end of the well-established Spartan Rd industrial area.

“The beauty of this offering, which is potentially subdivisible, is that price expectations are roughly half that of other industrial land in the Auckland region, which is currently fetching in the vicinity of $250-$300 per square metre,” Mr Church says.

“This location may look fairly raw but it is very much an emerging growth area. The land is just five minutes to the Takanini north-south motorway interchange, which is scheduled for a $210 million upgrade within the next three to four years.

“High-profile operations such as Fonterra Brands New Zealand’s head office and the $60 million Geni-i/Revera Takanini data centre underpin the value of the Takanini area as ‘one to watch out for’ as Auckland struggles to come to terms with future industrial development credentials.”

Mr Church says that if the Takanini offering had been in Wiri or East Tamaki, it would have “sailed out the door” the minute it was listed for sale.

“Takanini is next in the opportunity line, and visionary developers or owner/occupiers will be weighing up the cost-value proposition with pragmatism.”

Northwest of Auckland, six lots within a soon-to-be-completed subdivision on the corner of Deacon and Forestry Rds in Riverhead – formerly home to Carter Holt Harvey’s timber processing operation – are being sold.

The land has been in family ownership for more than 30 years and has price expectations much lower than those being touted for neighbouring industrial sites and lower than the $200-$250/m2 bracket which is the average norm for North West Auckland currently.

“When compared to other available industrial land for sale across Auckland, you could argue that this Riverhead land is somewhat undervalued,” Mr Church says.

“The potential for businesses to set up operations from these well-located sites to support the escalating residential population in the greater north west area around Riverhead, Hobsonville Point, and Whenuapai is huge.

“With connectivity between West Auckland and the rest of the region evolving with the State Highway 20 Waterview Connection on track for a 2016-2017 completion, the Riverhead area is becoming more accessible and is coming on to developer and owner-occupier radars.

“Changes in the roading system will ultimately streamline the route from Albany through to Manukau, so the logistics of moving goods will become very straightforward.”

Mr Church says that to cater to the region’s projected population growth and associated employment market fundamentals, new supplies of industrial business land must continue to be identified.

The Bayleys communications team is funded by Bayleys Real Estate.