A newly-released property investment offer is giving everyone in New Zealand the opportunity to share in the ownership of Woolworths New Zealand’s primary South Island distribution centre located in Christchurch’s pre-eminent industrial suburb, Hornby.

Centuria Funds Management (NZ) Limited (Centuria NZ) is the issuer of the units in the new offer, Centuria Shands Road Property Trust (the Trust). The offer of units in the Trust relates to the land and buildings at 146 Shands Road, Hornby which houses Woolworths’ existing distribution centre, along with a neighbouring parcel of vacant land at 166 Shands Road, which is being acquired to soon expand the current facility to meet the tenant’s growing requirements.

The tenant, General Distributors Limited, trading as Woolworths, commenced a new 15-year lease over the property on 30th August 2024, with rights of renewal until 2059, providing a long term income stream with built-in rental growth. The lease is guaranteed by Woolworths New Zealand Limited and the property is deemed a key piece of the company’s operational infrastructure.

Woolworths will continue to operate from the existing facility while it completes a new, modern 17,000sqm warehouse extension on the adjacent site to meet its growing operational requirements.

The minimum investment in the Trust is $25,000. It offers a 7.35% per annum forecast pre-tax cash distribution for the first three years from 1 April 2025, paid to investors monthly.*

The fully underwritten investment’s PIE structure makes this a tax-effective investment for many investors, who will be subject to a maximum tax rate of 28%.

Centuria NZ is part of ASX200 listed Centuria Capital Limited who manage over $20 billion of assets. In New Zealand, Centuria NZ manage around $2.5 billion of assets, and has a 20-year track record in property-related investments across commercial, industrial, retail, office, healthcare, agricultural and self-storage sectors.

Centuria NZ chief executive officer Mark Francis says the new Centuria Shands Road Property Trust investment opportunity has been launched as a single asset investment vehicle and encompasses both the existing distribution centre facility and the to-be constructed new warehouse extension on the adjacent site.

“The Trust will own the substantial total 10.54 hectare landholding, the existing warehouse and the expanded warehouse facility, with a combined lettable area of 46,981sqm making this an offering with considerable scale.”

“The tenant is responsible for the new building works and the Trust, as landlord, is insulated from cost and delay risk, through fixed dates for rental increases and a capped landlord contribution to expansion costs.”

Centuria NZ has appointed Bayleys Real Estate to market the investment offering. Head of Bayleys’ Funds and Investment Products division, Mike Houlker, says the calibre of the tenant, the location, and the role the facility plays in Woolworths’ South Island operations all underpin the offering.

“The tenant advises that it operates 188 Woolworths supermarkets in New Zealand, with annual revenue in excess of $7 billion and total assets in excess of $2 billion in the year to 30 June 2024.”

“This asset provides investors with a long-term income stream, with identified built-in rental growth, supported by its prominent location on a prime corner site in Hornby, Christchurch’s well-established and highly regarded industrial suburb.”

The property sits at the juncture of State Highway 1 and the Christchurch Southern Motorway, providing transport links north, south, east and west.

“The Hornby area has benefitted significantly from these motorway linkages and improvements made across Christchurch's motorway network since 2011. Other occupiers have identified the benefits of this location with Foodstuffs, Hallensteins, Glassons, Amcor, DHL, Oji, Sleepyhead, Fonterra and Heinz Watties also being located in this highly regarded Hornby industrial precinct. There remains ongoing development in this area” says Houlker.

Bayleys Funds and Investment Products manager, Samara Phillips, says industrial properties have achieved good returns over the long-term and the recent reduction of the Official Cash Rate is likely to be positive for the industrial property market.

“This is a tax-effective vehicle for investors to share in the ownership of the substantial and soon to-be expanded Woolworths primary South Island distribution facility, which has an ‘as if complete’ valuation of $90 million as at 23 October 2024.”

Application for units in the Trust can be made via a Product Disclosure Statement available from Bayleys or by visiting centuria.co.nz/shands.

Article supplied by Bayleys and Centuria NZ.

Cash distributions are not guaranteed. Actual distribution rates may vary. Details on how the forecast pre-tax cash distributions are calculated (including the key assumptions upon which they are based), and the risks associated with the investment are set out in the Product Disclosure Statement.

Centuria Funds Management (NZ) Limited is the issuer of the units in Centuria Shands Road Property Trust. A Product Disclosure Statement for the offer of units is available, and can be obtained by contacting the Bayleys Real Estate agents listed in this advertisement (0800 BAYLEYS). Nothing in this advertisement constitutes an invitation to subscribe for, or an offer of, units, shares, securities or other financial products to any person, in any country, in which it would be unlawful to do so. Terms used in this advertisement have the same meaning as defined in the Product Disclosure Statement, unless the context suggests otherwise.

Prospective investors are recommended to seek professional advice from a financial advice provider which takes into account their personal circumstances before making an investment decision. The selling agents are not providing personalised advice. Important information about the financial advice service provided by Bayleys Real Estate Limited is available www.bayleys.co.nz/funds