One Roof, November 2019

An opportunity to invest in a high-yielding regional property tenanted by national retail brand The Warehouse is being offered to investors through a new proportional ownership syndication scheme.

The Warehouse New Plymouth is a 5,904sq m bulk retail store within a larger unit-titled retail development at 67 Courtenay Street, New Plymouth.

The property is strategically positioned at the heart of the main centre of Taranaki, which has the second-highest per capita GDP of any region in New Zealand.

Features include the use of 207 car parks under separate New Plymouth District Council ownership, a high NBS seismic rating of 135 per cent, and dual street frontages to two of New Plymouth’s main arterials.

Silverfin Capital Limited is offering investors an opportunity to acquire a share of the beneficial interest in Unit 10, 67 Courtenay Street, New Plymouth, through a proportionate ownership scheme.

The 67 Courtenay Street Scheme comprises 156 investment parcels of $50,000 each.

Investors are expected to earn an annual pre-tax cash return of 7.75 per cent, projected to 31 March 2021, with dividends to be paid monthly.

Silverfin has appointed Colliers International’s Syndications team to market interests in the scheme.

Charlie Oscroft, Syndications Director at Colliers, says it is an opportunity to for investors to capitalise on a high-performing asset in one of New Zealand’s strongest regional economies.

“The property represents a premium retail investment backed by one of New Zealand’s most iconic homegrown brands.

“It is fully leased to The Warehouse Limited on a 12-year term to October 2026, with three rights of renewal of three years each.

“The lease returns $882,750 plus GST in net annual rent, with reviews every three years to the greater of CPI or market rental.

“The property was purpose-built for The Warehouse, along with the wider retail centre, by a company related to The Warehouse. It was completed in 2000 and underwent a significant $1.2 million refurbishment in 2013.

“Overall, the property makes for a very compelling investment proposition thanks to the quality of the building, strong rental returns, exceptional tenant covenant and superb location.”

The stratum in freehold property sits on a regular shaped site with 72m of frontage to Courtenay Street and 102m to Devon Street.

Both streets are major retail destinations and key thoroughfares through New Plymouth’s CBD, providing the property with a substantial pedestrian presence and huge exposure.

The Warehouse sits opposite a New World supermarket on Courtenay Street and an Event Cinemas complex on Devon Street, as well as numerous commercial office premises.

It is 200m north of Pak’n Save and 400m east of New Plymouth’s main shopping centre, ‘Centre City’.

The Warehouse site slopes down from Courtenay Street towards Devon Street, allowing for an undercroft parking area with 168 car parks. An additional 39 on-grade car parks front Courtenay Street. The car parks are on separate titles owned by New Plymouth District Council and can be used by both customers and the public.

The building has a generic ‘bulk retail’ layout with checkouts at the front of the store and the main retail area, offices and staff amenities behind. It is serviced by a loading dock accessed via a right of way over a neighbouring site.

The purchase price for the property is $13 million, reflecting a 6.8 per cent yield. The purchase price is supported by a recent market valuation from JLL of $13.25 million.

The Warehouse has one other store in New Plymouth, some 7km northeast in Bell Block. Its main competitor, Kmart, is not yet established in New Plymouth.

The Warehouse Limited is a subsidiary of the Warehouse Group, which is an NZX-listed company and the largest retail group in New Zealand, with more than 240 retail locations employing over 12,000 people nationwide.

The company generated group sales of $3.1 billion in the last financial year, up 2.6 per cent on the previous year, with an 18 per cent increase in online sales.

Silverfin is a leading player in the New Zealand property syndication and management market, with more than $388 million of commercial property assets under management.

The 67 Courtenay Street Scheme is limited to wholesale and eligible investors only. It has no fixed term but can be terminated by an investor-passed resolution. The offer closes at 5pm on 13 December 2019. Silverfin reserves the right to close the offer earlier if fully subscribed, extend or withdraw the offer.