Pioneering industrial park in Rolleston, near Christchurch, will gross $150 million
Thursday, 18 October 2018
The pioneering Izone Southern Business Park development, south of Christchurch, will have grossed $150 million of land sales when all have been completed, owner Selwyn District Council says.
After costs, the council will have earned $40m from the 188-hectare industrial park in Rolleston, at one stage New Zealand's biggest industrial park.
Izone is now 17 years old and nearing the end of its development with about 10 sites, each of less than half an acre, left to sell.
The council embarked on the venture to bring businesses and jobs to the area, after surveying residents who told it that was what they wanted.
Launched in 2001, one of its first occupants was The Warehouse. The council built a giant distribution centre for New Zealand's biggest discount chain and then sold it to an investor.
**READ MORE:
* Izone business park exceeds expectations
* Carter's IPort sections hit the market
* Carter Group launches $500m industrial park**
'The surplus funds created from Izone of $40m are being used to help fund the building of the new Rolleston Library ($5.5m), capital works within the transportation/roading projects ($10m) and the balance will be invested to provide income from cash deposits, property leases,' council property and commercial manager Douglas Marshall said.
The council initially brought about 130ha of farmland for the development and later added about another 50ha.
The development is now coming to a close.
'At this time, council is not proposing to undertake any further industrial land development,' Marshall said.
Across the main highway from the Rolleston township and 22 kilometres southwest of Christchurch, Izone hosts more than 120 businesses, involved mostly in manufacturing, contracting, warehousing and logistics, and agricultural servicing.
The Selwyn District is now home to about 60,000 people, including the blossoming township of Rolleston where a new secondary school opened last year to cater for the growing population.
Izone's manager, developer Robin Hughes, said the development had driven a shift of industrial users from the east of Christchurch after the earthquakes, and from the Hornby industrial area.
The big drawcards had been the lower land prices, lower rates than Christchurch's and no development contributions, which had been prepaid by the council as the developer, he said.
Izone's success has drawn one of Christchurch's most well-known property developers, the Carter Group, to set up an industrial and logistics business park, called IPort, across the road from Izone.
IPort director Tim Carter said that with 94 per cent of Canterbury's exports going through Rolleston, it was an ideal aggregation point for road and rail transport.
Some 20 sites at IPort, ranging from 800 square metres to 1.1ha, had been sold or were under contract. Sales and construction were progressing well and the company had been receiving high levels of inquiry from potential occupiers.
'Rolleston is well on its way to housing a critical mass of logistics-related occupiers with freight links that are among the best in the South island,' Carter said.
Real estate agents Savills said land values had been rising in Rolleston with the average bare industrial land prices up 78 per cent in six years from 2012 to 2017, according to sales data from Core Logic.
In 2012, the average sale value of bare industrial land in Rolleston was $105 per sqm, with six sites sold during the year. By 2017, the average sale value had risen to $187 per sqm across 14 transactions.
Savills industrial broker Ben Dwan said the extension of the Southern Motorway was helping drive the appeal of Rolleston, with travel times between Christchurch and Rolleston expected to halve. The extension is expected to be completed in 2020.
Rolleston also had the added benefit of rail access with the South Island main trunk line and the Midland line intersecting there, Dwan said.
Two of New Zealand's large ports have set up rival inland ports at Rolleston.
Port of Tauranga established Metroport first, on Izone land, while Lyttelton Port of Christchurch bought 27ha in the IPort development for its Midland Port.
Christchurch specialist construction company Calder Stewart has bought about 30ha of land at Izone in the past 18 months.
Property manager Kevin Arthur said the company held land for sale, lease and design build projects for business customers. There was quite a lot of demand for Izone land from distribution businesses with large 'sheds'.
The completion of the Southern Motorway's second stage would be a 'game-changer' for Rolleston.
'We are certainly making a statement that we think Izone and Rolleston have a big part to play in Christchurch,' Arthur said.