Heinz Wattie's National Distribution Centre, Hastings
Important Information: Past performance is no guarantee or indication of future performance. Returns may vary and are not guaranteed. Applications for the Hasting Distribution Centre Property LP are not currently being accepted as the syndication has been fully subscribed.
This syndication is now fully subscribed!
+ $100,000 minimum investment open to wholesale investors only
+ 8.0% p.a* projected cash return paid monthly
+ Tenanted by Heinz Wattie's, an iconic New Zealand brand
+ It features a rail siding providing direct rail access to Napier Port
+ It’s on a 6.3 hectare site with a gross floor area of 45,351 m2
+ The warehouse is A+ seismic rating meeting 100% NBS
+ 7.65 years lease as at 1 September 2019
+ Annual rent of $2,218,719 plus GST
+ Rent subject to CPI increase every 2 years from May 2020
*Projected pre-tax return for full one-year period. Details on how the return will be calculated, and the risk associated with the investment and return, will be set out in the relevant Information Memorandum.
Offers will be restricted to “Wholesale Investors” under clauses 3(2) and 3(3) of Schedule 1 to the Financial Markets Conduct Act 2013 (or to any other person to whom an exclusion applies under Schedule 1 of that Act). Preliminary indications of interest are being sought at this stage and no indication of interest will involve an obligation or a commitment to participate in the Offer.
Investment Summary Video
For more information on the property, location, tenant and financials of the investment opportunity, watch the video below.
The property is located at 113 Elwood Road, Hastings and is a substantial industrial complex which was developed in stages from the 1990’s through to 2005. The facility is the Heinz Wattie's Distribution Centre.
This property is immediately adjacent to the North Island Heinz Wattie’s manufacturing/ processing plant and comprises a large medium stud distribution warehouse complex, handling over 1200 product lines, with rail siding capabilities connecting directly to Napier Port. It has a total gross floor area of 45,351 m2, excluding canopies and tarsealed yard.
The property comprises a 6.3 hectare site and is predominately leased to Heinz Wattie’s on a long term lease which expires on 30 April 2027. There is another building on-site which is leased to tenant, Tomoana Warehousing Limited.
Heinz Wattie’s is owned by Kraft Heinz, the USA based Fortune 500 company. They are the 3rd largest food and beverage company in North America and the 5th largest in the world.
The annual rent from this property is $2,218,719 with 7.5 years of lease term remaining. We are confident that Heinz Wattie’s will remain committed to the site as it’s adjacent to their manufacturing plant and features a rail siding. The cost to build a similar scale distribution centre in another location would be substantial. The parent, Kraft Heinz, does not guarantee the obligations of the Tenant under the Lease.
The second tenant, Tomoana Warehousing Limited, leases part of a building known as the Grey Shed for an annual rent of $60,000 which is less than 3% of the annual rent from Heinz Wattie’s National Distribution Centre.
Why Invest In Hawkes Bay
The Hawkes Bay’s regional economy is worth $8.1 billion and is a major contributor to New Zealand’s horticulture sector. The region is a premium global producer, processor and exporter of primary products such as fruit and vegetables, beef, lamb, wine and forest products.
Hawkes Bay is a major agriculture and food processing hub, with farms and orchards spread across its plains and 353 kilometre coastline.
Napier Port is the country’s fourth largest port with 66% of its revenue coming from container services. It has just raised $234M for expansion plans in a successful IPO.
Tourism spending in the Hawkes Bay was up 3.6% as at March 2019 year on year, with spend at $658 million.
In terms of commercial property, the average value of non-residential consents increased by 23.9% for a total annual value of $153 million for the year ended 31 March 2019.
This all points to the Hawkes Bay region as one in an exciting growth phase and a compelling investment destination.
Investments in syndicated commercial and industrial property does carry risk. Prospective investors must determine whether the investment is appropriate having regard to their own investment objectives and financial situation. Investors are encouraged to seek independent financial, tax and legal advice on these matters.
The Offeror and General Partner considers that the most significant risk factors that could affect the value of an Limited Partnership interest are:
Loss of rental income: A default by any tenant in paying rent outgoings may affect forecast returns.
Re-leasing: Costs may be incurred in any future re-leasing of the property and failure to re-lease will likely affect its value.
Interest rate and bank risk: Interest rate movements are unable to be accurately predicted and an increase in interest rates may affect returns and bank covenant compliance.
Capital expenditure risk: Capital expenditure for the property may be more than budgeted.
1. Projected cash returns are for a full one-year period. Distributions have been paid monthly at the projected pre-tax rate of 8% pa since inception. Payment of past cash distributions does not indicate or guarantee future distributions can be maintained at the same rate as returns may be impacted by risks including those outlined in the Information Memorandum for the offer.
2. The annualised pre-tax total return is calculated based on cash distributions paid together with the net asset value growth of the syndication during the period from the date of acquisition of the property to 31 March 2022. No allowance has been made for future selling costs or any amortisation of issuance costs. Past performance is no guarantee or indication of future performance.
3. The property was acquired on 19 December 2019. This is the purchase price for the property only and does not include other costs associated with preparing the offer.
4. A market valuation of the property is prepared annually for the year to 31 March. The stated market value is from the valuation prepared for the year ended 31 March 2022. The market valuation may have changed in the intervening period.