DTZ facilitates National Bank Centre sale

Published: Wed 8 Nov 2006 10:28 AM
DTZ facilitates National Bank Centre sale
After an extensive international sales campaign, AMP Property Portfolio subsidiary Capital Properties New Zealand Limited (CPNZ) has entered into an unconditional contract to sell its undivided 50% share in the National Bank Centre, at 209 Queen Street in Auckland to Kiwi Income Property Trust (KIPT).
The property changed hands for $55.6M and the sale was facilitated by DTZ Auckland’s Kevin Richards. “The process was challenging due to the property’s co-ownership structure so we are very pleased with the result which represents a successful outcome on all levels for the vendor,” says Richards.
The 26,146 sqm building, completed in 1990, comprises two office towers with ground floor retail and basement car parking. The sale price of $55.6 million provides an initial yield on passing net income of 7.58%. Settlement is scheduled for later this month and the sale proceeds will be used to retire bank debt.
Nick Cobham, Auckland Manager for CPNZ, says his organisation has been formally working to sell the property since January this year, and, given the pre-emptive provisions of the joint venture agreement, a fairly complex sales process was put in place for the purpose of securing a sale of Capital’s undivided 50% interest in the National Bank Centre at market value, being one half of the NBC leasehold interest.
This was achieved with a conditional contract to sell its 50% interest in the property to a third party Australian investor, conditional only on complying with the pre-emptive right provisions of the Joint Venture agreement with KIPT.
“Throughout the sale process, from expression of interest to indicative offer, Kevin Richards worked tirelessly and identified a number of prospective purchasers with our entering into an exclusive negotiation with an Australian Investor. The process was relatively slow because of the complex pre-emptive right provisions and ownership structure of the property. In the final outcome, KIPT exercised its option to purchase and we are delighted with result.”
This sale is consistent with a strategy to focus primarily on efficient Auckland B-grade private sector office and the Wellington government office sector where CPNZ has a number of developments pending, underway or nearing completion. This sale increases the government office sector weighting in the Capital Properties portfolio from 46% to 60% of total assets by market value and has a corresponding decrease in private sector office from 38% to 31%; the balance of assets being made up of a combination of retail and CBD car parking.
ANZ National Bank currently occupies approximately 42% of the office space in the building with leases until 2011, and Lawyers, Phillips Fox, hold the naming rights of Tower 2 and are another major tenant.

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