Key Kiwifruit Operator's Packing And Coolstore Property For Sale While Industry Booms

A medium-sized Takanini packhouse and coolstore used exclusively for post-harvest in the $2.9 billion New Zealand kiwifruit industry is on the market for sale and leaseback.

The 7,223 square metre Auckland Pack & Cool (Apac) facility on 1.1 hectares at 149 Phillip Road, Takanini packs and coolstores kiwifruit for export and distribution by the country's single desk seller Zespri International.

It is one of the kiwifruit industry's key post-harvest operators, with the resources to pack about 3.5 million trays each season, and a combined on-site and satellite cool storage capacity for 1.75 million trays.

It is part of the wider Jace Group, which also owns the Mount Pack & Cool (Mpac) facility in Mount Maunganui, which packs around 12.5 million trays a season. Combined, the two post- harvest facilities equate to about 10 percent of the national crop.

Along with Apac's extensive cool storage facilities for packed fruit at Takanini, it operates four controlled atmosphere rooms and three bin store rooms which enables the business to significantly increase the amount of fruit it can pack each season (an extra 700,000 tray equivale

Along with Apac's extensive cool storage facilities for packed fruit at Takanini, it operates four controlled atmosphere rooms and three bin store rooms which enables the business to significantly increase the amount of fruit it can pack each season (an extra 700,000 tray equivalents).

Apac's business model is dedicated to providing a low cost, high quality service with a focus on helping its growers to consistently achieve industry leading orchard gate returns.

Returning $780,000 + GST a year, the property has a lease running until 2043 and has been put on the market by existing owner Apac to free up capital for investment into the business. It is being marketed for sale by tender closing on March 11 through Bayleys South Auckland salespeople Shane Snijder and Peter Migounoff.

Mr Snijder said a new owner will reap the benefit of a rent increase to CPI on May 1, which is expected to add about $30,000 a year to the rental return. “Jace is also investing a substantial amount of money in upgrading the cooling systems for the post-harvest operation.”

The company's 15 year lease started in May 2018 and has two five year rights of renewal with expiry in 2043. During the lease term there are two yearly rent increases to CPI and if needed increases to market in 2028, 2033 and 2038. The existing lease will be sold to a new owner.

Built progressively from the 1990s through to 2016, the freehold modern premises consist of a pre-cooler, temperature controlled rooms, bin rooms, two packhouse areas, offices, staff facilities and four canopies. The offices and staff facilities are to the front of the property where there is also ample car parking for staff and visitors. A four bedroom manager's/caretaker's house is also on the property, giving overall site coverage of 62.3 percent.

The South Auckland premises are conveniently located to service growers from as far afield as the top of the North Island to just across the road and are only five minutes off the Southern Motorway and close to the airport.

Zoned mixed use (1b) rural, the property has an Auckland City Council rating valuation (RV) $4.4 million but is expected to sell for substantially more as Mr Migounoff said the RV does not reflect its true value.

“There has been keen interest in the property and its value as a passive investment with guaranteed rent rises,” Mr Migounoff said.

“Apac is a long-standing and well established business with a high tech processing facility in South Auckland servicing Waikato, Auckland and North Auckland in a food supply chain growth industry.”

He said the company said it has attracted a loyal group of clients who benefit from being in a “consistently high performing grower pool with consistently higher than industry average returns”.

The industry is booming again after overcoming the devastating Psa virus and now represents 29 percent of the country's total horticultural export revenue. Industry growth has been staggering in the past five years with record global sales $2.94 billion coming from 167.2 m million trays (3.55kg = 1 tray) sold in the year ended March 2019.

There are about 2,600 kiwifruit growers and 2,900 registered orchards in New Zealand, with about 12,185 hectares of in production. Zespri is the world’s biggest marketer of kiwifruit, selling into more than 53 countries and managing 30 percent of the global volume.

Hayward green kiwifruit has been the main crop but more than 5,000 hectares of the new gold kiwifruit cultivar, commonly known as Gold3, have now been licensed in New Zealand with more than 80 million trays produced in 2019. New licences were released last year.

New Zealand has some of the best growing conditions in the world for kiwifruit - encompassing clean air, fertile soils, a cool ocean, generous climate and fewer pests and diseases contribute to the unique quality and taste of locally-grown kiwifruit.

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