Industrial Investment | $7,567,707 | Net Yield: 6.15% | Christchurch, NZ

This off-market Christchurch industrial investment presents an opportunity to secure a substantial 7,443 square metre freehold site within one of the city's most established industrial precincts. Comprising approximately 3,803 square metres of warehouse, office and canopy accommodation, the property combines strong passing income, long-term lease security and significant rental reversion potential within a strategically connected industrial location.

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The property generates combined passing income of approximately $465,414 per annum, underpinned by a well-established national operator with a 30-year trading history. The primary tenant has occupied the property since 2019, with two further five-year lease options providing potential tenure through to 2034. The lease is structured on a 100% net basis with annual CPI increases and a market review upon renewal, providing both income security and embedded rental growth. An additional sealed yard of approximately 1,122 square metres is separately leased, generating a supplementary income stream from the broader site.

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The primary tenancy comprises approximately 3,124 square metres of warehouse accommodation, 246 square metres of ground and first-floor office space and 433 square metres of canopy. Combined with 24 open car parks and the separately leased rear yard, the asset provides a functional industrial configuration suited to logistics, distribution and warehouse-based occupiers.

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A key feature of the investment is the identified rental reversion opportunity. Based on current market assessments of approximately $120 per square metre for warehouse accommodation, $220 per square metre for office and amenities and $70 per square metre for canopy, the property has an assessed combined market rental exceeding $500,000 per annum net. This represents approximately 7% upside from current passing rental levels, or approximately $35,000 in potential additional annual income.

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At the Rethink negotiated capitalisation rate of 6.15%, this rental uplift could represent approximately $560,000 in additional capital value if the assessed market rental is achieved and the capitalisation rate is maintained. This provides investors with an identifiable value-add pathway alongside the property's existing income profile and contractual rental growth.

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Located within an established industrial precinct approximately 12 kilometres south-west of the Christchurch CBD, the property benefits from excellent access to State Highway 1 and the Southern Motorway. These major transport connections provide efficient access across the wider Canterbury region, including Christchurch International Airport, the Port of Lyttelton and the CBD. The surrounding precinct remains a key location for logistics, manufacturing, distribution and trade-related businesses, supporting ongoing demand for strategically positioned industrial assets.

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At a Rethink negotiated purchase price of $7,567,707, the investment delivers a 6.15% net yield on current combined income. Based on an assumed 65% loan-to-value ratio and 6.5% annual interest rate, the property is projected to generate approximately $145,678 in annual cash flow after mortgage interest expenses, representing a 5.19% cash-on-cash return. These figures reflect the acquisition modelling assumptions and are not guaranteed returns. Combined with contractual rent reviews and the identified rental reversion, the property offers both immediate income and potential medium-term capital growth.

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With a substantial freehold landholding, established national tenant profile, 100% net primary lease structure, strong transport connectivity and approximately 7% identified rental upside, this off-market acquisition reflects the calibre of industrial investment opportunities Rethink Investing continues to secure for clients across New Zealand.

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About Rethink Investing

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