Waste site sale offers rare income security

The upcoming sale of Gisborne’s main waste management site is offering a bottom-drawer industrial investment of exceptional quality and lease length.

The more than 8,600-square-metre freehold property in the Awapuni industrial precinct is home to WM New Zealand’s Gisborne recycling and refuse transfer station.

Now for sale through Bayleys Real Estate, the Innes Street facility offers investors a stake in a vital piece of city infrastructure with a level of income security seldom witnessed by salespeople marketing the sale.

WM New Zealand occupies the site on a current lease that runs to 2046 with rights of renewal extending for a further four decades. The lease generates an annual net rental return of $416,658 plus outgoings and GST.

Bayleys Gisborne salesperson Mike Florance says investment credentials are further enhanced by built-in “hard ratcheted” rental reviews, which ensure rental growth while protecting against any reduction in income.

The lease provides for fixed 2.75 percent annual rent increases with a market review every 10 years.

“This highly defensive lease structure, with 20 years to run on the initial lease, provides an exceptional level of income certainty rarely available in today's market.

“The specialised nature of the improvements, together with the tenant's significant operational investment in the site, creates substantial tenant retention incentives and further reinforces the long-term security of the income stream.

“The sheer quality of this investment proposition is capped off by the calibre of the tenant, New Zealand’s leading materials recovery, recycling, and waste management provider,” Florance says.

With origins dating to the 1890s, WM New Zealand has grown into a business with over 2,000 people across 90-plus locations and a growing focus on sustainability. Each year, it collects more than one million tonnes of waste and recycles well over 200,000 tonnes.

Its Awapuni facility encompasses several sizeable buildings spanning a combined 3,792 square metres (approximately) plus extensive paved yard areas accessed from Innes Street. It sits on some 8,663 square metres of Industrial-zoned land across four freehold titles.

The land and buildings at 65-75 Innes Street are being offered to buyers by way of a tender closing on Thursday 6 August (unless sold prior), through Florance and Bayleys colleague Sunil Bhana.

Bhana says the large-format industrial landholding in tightly held Awapuni offers enduring strategic value.

“This area is recognised as the region’s core industrial hub. Handy to Gisborne’s city centre, port and airport, it offers excellent accessibility and regional connections. Proximity to State Highway 35 and other key transport links supports efficient movement of traffic and heavy vehicles throughout Gisborne and beyond.

“Surrounded by established industrial operators and essential services, this location reinforces the property’s importance within the wider regional infrastructure network while ensuring long-term relevance for occupiers and investors alike,” Bhana says.

Industrial zoning under the Tairāwhiti Resource Management Plan provides for a wide range of industrial, warehousing, logistics, manufacturing, trade, and contractor-based activities, supporting businesses that require operational flexibility, vehicle access, and servicing infrastructure.