Archive | Westgate

Updated: Construction starts on next north-western subdivision, West Hills

Published 17 October 2018, clarified 18 October 2018:
Half a kilometre west of the Westgate & NorthWest retail & business centres at the top of Auckland’s North-western Motorway, Universal Homes Ltd has started work on the first block of 7 units in its next subdivision, West Hills, which will ultimately yield about 1200 homes.

The 41ha development is unusual because it allows construction to proceed alongside the provision of infrastructure, a consent provision which vice-general manager Andrew Crosby reckons will save about 9-10 months in getting the project to market.

Image above: West Hills, where construction has started as infrastructure works continue.

Clarification on pricing:

On Wednesday morning I wrote: “The first batch of 7 terrace houses will include 4 56m² one-bedroom units without a garage, priced at the bottom of the Universal scale, about $5000/m², which will see them marketed for $285,000.”

Universal told me later in the day the 4 56m² one-bedroom units would come later in stage 1, haven’t had their prices set yet, but they would exceed $285,000.

In the first batch of 7, one with a floor area of 82.5m² has 2 bedrooms and the rest have 3 bedrooms.

The table below sets out prices for the first 7 homes released. I’ve added a column to show the range of prices/m², without distinguishing between living & garage space:

West Hills pricing, first batch of 7 homes:
Lot Beds Price Floor area*  Price/m²
1 3 $849,000 131 $6,481
2 2 $695,000 82.5 $8,424
3 3 $851,000 131 $6,496
4 3 $799,000 113.2 $7,058
5 3 $799,000 113.2 $7,058
6 3 $845,000 131.8 $6,411
7 3 $850,000 131.8 $6,449
* Floor area including garage where applicable

But most of West Hills won’t be in the sub-$600,000 “affordable” category, although they’ll come in comfortably below much of the $1 million-plus construction at nearby Hobsonville Point – the standard homes of 2-4 bedrooms will be priced between $695-851,000.

Those prices include rises in Auckland Council development contributions & water service charges.

“For the level of quality which we want – which is not super-luxury – this is as affordable as a good builder can make it,” Mr Crosby said.

Universal Homes vice-general manager Andrew Crosby onsite at West Hills, with concurrent drainage & earthworks & construction underway behind him.

Universal’s West Hills block off Fred Taylor Drive will form about 10% of the Redhills special housing area precinct, land held by a number of developers and all rezoned under the new Auckland unitary plan to allow for a mix of building.

Mr Crosby expects Universal will take about 8 years to build out its project, providing some standalone homes but with an increasing focus on terraces & duplexes, including about 90 one-bedroom units but dominated by 2-bedroom homes.

Both Mr Crosby & sales manager Mike Pearce attribute much of the improvement in what buyers will get to Universal’s participation in the development of Hobsonville Point, including the Axis energy-efficiency programme led by Government company HLC (2017) Ltd (the former Hobsonville Land Co).

Mr Pearce: “The high quality of urban design, energy efficiency & value-for-money pricing of the homes is due to Universal’s extensive experience at Hobsonville Point with urban designers Isthmus, a key partner at Hobsonville Point, leading the masterplanning, along with Avery Team Architects & Construkt Architects.

“The community & environmental dimensions are a major emphasis in the planning of West Hills, with the vision for the development described as green city living.”

Hobsonville Point led the way towards intensification, though generally not multi-level apartment projects (that said, a multi-level project there is up for hearing today).

“Hobsonville Point changed the thought that you’d have a standalone 5 years ago, but it took about 3 years to start building apartments,” Mr Crosby said.

Now, at West Hills, terraces & apartments are the first structures to go up, and terraces & duplexes form about 80% of Universal’s overall business.

For inter-tenancy walls, Universal uses Speedwall, a lightweight, quake-resistant & fire-resistant slab produced onsite.

Site works to break up the intensity include opening up watercourses for streams, wetland areas, a 5000m² pocket park, playgrounds (smaller ones vested in the owners’ society) & walkways.

My biggest question about the recent expansion of suburban housing developments – and greenfield plans further out on the fringe – is the access to shops & amenities. West Hills answers that question with its proximity to Westgate & Northwest.

The first homes at West Hills will be completed early next year, and the first stage will contain 94 homes.

Attribution: Site visit, company releases.

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8 sales & 11 leases from Silverdale to city to Westgate

Bayleys North Shore agents have notched up 8 sales & 11 leases of commercial property from Silverdale down to the inner city and across to Henderson & Westgate.



Learning Quarter

76 Anzac Avenue:
Features: 356m² site, 1097m² 3-storey office building, one parking space
Rent: $60,000 net + gst, plus $96,000 gross + gst
Outcome: sold 2 weeks ago for $5.3 million + gst at $4831/m², 2.94% yield
Agent: Tonia Robertson



60 Apollo Drive:
Features: 1729m² site, 1301m² industrial premises tenant Wallace Cotton Ltd
Rent: $228,210/year net + gst
Outcome: sold in March for $5.1 million + gst, at $3920/m², 4.47% yield
Agent: Matt Mimmack

15 Lovell Court, unit 12:
Features: 100m² office, 2 parking spaces
Rent: $28,600/year net + gst at $3350/m², 8.54% yield
Outcome: sold in April for $335,000 + gst
Agents: David Han & Annette Lum

Rothesay Bay

2-8 Montgomery Avenue:
Features: 316m² site, 190m² retail, 3 parking spaces
Rent: $70,000/year net + gst
Outcome: sold in March for $1.185 million + gst, at $3750/m², 5.9% yield, 3 weeks after being passed in at $1.1 million at auction
Agents: Brian Caldwell, Adam Curtis & Michael Nees

Wairau Valley

17 Ashfield Rd:
Features: 1017m² site, 692m² building, 5 industrial units on one title
Rent: $75,600/year net + gst
Outcome: passed in at March auction at $1.535 million, sold a week ago for $1.7 million at $2457/m², 4.45% yield
Agents: Trevor Duffin & Ranjan Unka

18 Link Drive, unit H:
Features: 462.09m² bulk retail unit – showroom 358.8m², mezzanine area 103.29m², 12 parking spaces
Outcome: sold in March with vacant possession for $1.4 million + gst, at $3030/m²
Agents: Trevor Duffin & Chris White

63 View Rd:
Features: 5885m² industrial site, 3093.8m² building – warehouse 2693.8m², office 400m², 15 parking spaces
Outcome: sold vacant for $6.6 million + gst, at $2133.30/m²
Agents: Tonia Robertson & Laurie Burt



1 Kawakawa Place:
Features: 3,223m² site, 1858m² retail & childcare property, 40 parking spaces
Rent: $562,464/year net + gst
Outcome: sold in March for $9.375 million, at $2909/m², 6% yield
Agent: Brian Caldwell




50 Centreway Drive, part level 1:
Features: 266.75m² office, 10 parking spaces; Auckland Council Orewa service centre & former council chamber building, council committee to decide on Tuesday whether it will be sold
Rent: leased in April for $66,687.50/year net + gst, premises rental $250/m²
Agents: Tonia Robertson & Mustan Bagasra


36 Arrenway Drive, unit B:
Features: 307m² industrial unit – warehouse 148m², showroom 79.5m², office 79.5m², 6 parking spaces
Rent: leased in March for $58,000/year net + gst, premises rental $189/m²
Agent: Laurie Burt

7 Douglas Alexander Parade, unit C:
Features: 298.7m² industrial unit – warehouse 121m², office 177.7m², 8 parking spaces
Rent: leased in March for $54,000/year net + gst, premises rental $181/m²
Agents: Caroline McNaught & Laurie Burt

2 Rothwell Avenue, unit F:
Features: 704m² industrial unit – warehouse 462.6m², office 241.4m², 10 parking spaces
Rent: leased in March for $105,000/year net + gst, premises rental $149/m²
Agents: James Kidd, Chris White & Laurie Burt

Part 15-17 William Pickering Drive:
Features: 836m² industrial & office unit – warehouse 638m², office 198m², 14 parking spaces
Rent: leased in March for $134,780/year net + gst, premises rental $161/m²
Agents: Laurie Burt & Tonia Robertson


30 Foundry Rd, unit 9:
Features: 590m² industrial unit – warehouse 419m², showroom 51m², office 89m², other area 31m², 8 parking spaces
Rent: leased in January for $105,000/year net + gst, premises rental $180/m²
Agent: Rosemary Wakeman

150 Foundry Rd, unit D2:
Features: 75m² office unit, 2 parking spaces
Rent: leased in March for $15,000/year net + gst, premises rental $200/m²
Agent: Rosemary Wakeman


15 Auburn St, unit 1A:
Features: 50m² office, parking space
Rent: leased in March for $18,000/year net + gst, premises rental $360/m²
Agent: Chris White

29 Northcroft St, part lower ground floor:
Features: 280.7m² office, 5 parking spaces
Rent: leased in March for $69,920/year net + gst, 2 parking spaces at $45/space/week each, 3 parking spaces at $35/space/week each
Agents: Jane McKee, Eddie Zhong & Dean Gilbert-Smith

Wairau Valley

101-111 Diana Drive, unit 17 (M):
Features: 970m² industrial unit – warehouse 690m², showroom 140m², office 140m²
Rent: leased in April for $165,000/year net + gst, premises rental $170/m²
Agent: Trevor Duffin



42 Paramount Drive, units 6 & 7:
Features: 280m² retail unit
Rent: leased in March for $80,000/year net + gst, premises rental $286/m²
Agents: Terry Kim & David Han

Attribution: Agency release.

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Bayleys office ends year with 9 sales & 11 leases

Bayleys agents from the North Shore branch have started the year reporting 9 sales & 11 leases in November & December.

5 of the sales and 9 of the leases were on the Shore and at Silverdale. The rest were in Epsom, Grafton, Huntly, New Lynn & Westgate.


Isthmus east


1B Edgerley Avenue:
Features: 357m² mixed-use property
Rent: $40,037/year net + gst
Outcome: sold at auction in December for $1.26 million + gst, yield 3.18%
Agent: Terry Kim



1-3 Parkhead Place:
Features: 4532m² industrial site, 2424m² building
Rent: $393,400/year net + gst
Outcome: sold in December for $5.1 million + gst at a 7.7% yield, $2104/m² land & building
Agents: Alex Strever, Laurie Burt & Matt Mimmack

4 Piermark Drive, unit D:
Features: 372.2m² industrial unit – office 175m², warehouse 150m², other area 47.2m², 7 parking spaces
Outcome: sold at auction in December for $920,000 + gst, at $2472/m² land & building
Agent: James Kidd

14-22 Triton Drive, unit C2:
Features: 130m² unit – office 90m², warehouse 40m², 3 parking spaces
Outcome: sold in December for $480,000 + gst, at $3692/m² land & building
Agents: James Yu & Alex Strever

14-22 Triton Drive, unit C3:
Features: 237.2m² unit – warehouse 55,9m², office 181.3m², 4 parking spaces        
Outcome: sold in December for $785,000 + gst, at $3309/m² land & building
Agent: Alex Strever


162 Foundry Rd:
Features: 2002m² site, 1032m² building
Rent: about $150,000/year net + gst
Outcome: sold in November for $3.05 million + gst, at 4.92% yield, $2955/m² land & building
Agents: Rosemary Wakeman & Matt Mimmack



Northside Drive, lot 1, unit 6:
Features: 294m² industrial unit, 4 parking spaces
Outcome: sold in November for $990,000 + gst, at $3367/m² land & building
Agents: >Matt Mimmack & Ashton Geissler

Northside Drive, lot 1, unit 4:
Features: 309m² industrial unit, 4 parking spaces
Outcome: sold in November for $1.06 million + gst, at $3430/m² land & building
Agents: Matt Mimmack & Ashton Geissler

South of the Bombays



3768 State Highway 1:
Features: motel business on 3065m² site, 690m² floor area
Income: $68,000/year net + gst
Outcome: sold in December for $1.25 million + gst at 5.4% yield
Agent: David Han


Isthmus east


14 Burleigh St, part ground floor:
Features: 561m² office, 16 parking spaces
Rent: leased in November for $144,360/year net + gst, $111,080 excluding parking, parking $40/space/week, premises rental $198/m²
Agent: Dean Gilbert-Smith



86 Bush Rd, unit U:
Features: 92m² office unit
Rent: leased in December for $29,660/year net + gst, net excluding parking $25,760/year + gst, premises rental $280/m²
Agent: Jane Sims


65 Birkenhead Avenue, basement:
Features: 200m² industrial space, parking space
Rent: $30,000/year net + gst
Agents: Adam Watton & Adam Curtis

Gulf Harbour

69 Gulf Harbour Drive, unit H:
Features: 145m² retail area, 8 parking spaces
Rent: $38,160/year net + gst
Agent: Terry Kim


5 Beatrice Tinsley Crescent, unit B:
Features: 361m² industrial unit, 5 parking spaces
Rent: leased in December for $50,000/year net + gst
Agent: Laurie Burt

10B Canaveral Drive:
Features: 300m² industrial, 5 parking spaces
Rent: leased in December for $52,000/year net + gst, net excluding parking $52,000, premises rental $173/m²
Agent: James Kidd

7 Vega Place, unit F:
Features: 132m² industrial unit, 2 parking spaces
Rent: leased in December for $23,000/year net + gst, net excluding parking $23,000, premises rental $174/m²
Agent: Laurie Burt

45 William Pickering Drive, unit A:
Features: 340m² industrial unit, 7 parking spaces
Rent: leased in December for $65,000/year net + gst, net excluding parking $65,000/year + gst, premises rental $191/m²
Agents: James Kidd & Laurie Burt

51 William Pickering Drive, unit 9, level 1:
Features: 60m² office space, parking space
Rent: leased in December for $14,000/year net + gst, net excluding parking $14,000, premises rental $233/m²
Agent: Terry Kim


10 Silverdale St, shops 2 & 3:
Features: 262m² retail area, no parking
Rent: leased in December for $98,000/year net + gst, premises rental $374/m²
Agents: Adam Curtis & Adam Watton


New Lynn

3047 Great North Rd, first floor:
Features: 370m² office, 10 parking spaces
Rent: leased in November for $93,000/year net + gst, $80,000 excluding parking, parking $25/space/week, premises rental $251/m²  
Agents: Chris White & Damian Stephen

Attribution: Agency release.

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Stride defers NorthWest 2 option expiry at Gunton’s request

Stride Property Ltd said today it had agreed to defer the expiry date of Westgate Town Centre Ltd (Mark Gunton)’s 3-year option to acquire Stride’s NorthWest 2 development.

The option was due to expire on Tuesday, 19 December, but will be extended to a date in the new year which depends on the outcome of Stride’s discussions with Mr Gunton.

Stride developed NorthWest 2 alongside the NorthWest Shopping Centre at Westgate, at what was then the top of Auckland’s North-western Motorway.

Stride chair Tim Storey said the company undertook the development after Westgate Town Centre Ltd granted Stride a conditional right & ground lease for the NorthWest 2 site. Under the agreement, Stride granted Westgate Town Centre Ltd rights allowing it to acquire the development from Stride within 3 years of the ground lease’s effective date (the deadline being Tuesday), at a price equal to 115% of Stride’s total development cost (including holding costs).

In the event that Westgate Town Centre Ltd didn’t acquire the development within the 3-year period, the agreement also permits Stride to obtain freehold title to the land for a nominal $1. In its accounts to 30 September, Stride held the NorthWest 2 development in the consolidated interim financial statements at $36.3 million.

Link: Stride interim report to 30 September 2017 (see accounts page 30, note 11 re NorthWest 2)

Earlier stories:
5 October 2015: Albany settlement helps Stride’s Westgate programme
30 September 2015: Westgate opens for business tomorrow
24 July 2015: DNZ looks to grow investment management as first Westgate project nears completion
11 February 2015: DNZ puts next property on market as NorthWest mall leasing hits 90%

Attribution: Stride release, interim report.

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3 sales, a syndication & a lease

Colliers agents have completed 2 sales & a lease in West Auckland, another at Rosedale, and have completed the syndication of 4 distribution centres through Silverfin Capital Ltd.

Syndication sale

Features: 4 Provida Foods Ltd national distribution centres
Outcome: sold to investors in 233 parcels in a Silverfin Capital Ltd proportionate ownership scheme for a total $11.65 million
Agents: Charlie Oscroft & Kris Ongley



35 William Pickering Drive, unit 4:
Features: 946m², retail showroom/warehouse
Rent: $170,000/year net + gst from tenancy running until 1 March 2018       
Outcome: sold for $2.765 million at a 6.14% yield
Agents: Jimmy O’Brien (Colliers) & Marty van Barneveld (NAI Harcourts)



Hobsonville Workspace, 102 Hobsonville Rd, lots 3 & 4:
Features: 600m² off-the-plan office site developed by The Neil Group Ltd; building to be developed by Kea Properties Ltd, it will include a childcare, retail, cafes & office, completion expected end of 2018
Outcome: sold to Kea for $2.848 million + gst
Agents: Sean Finnegan & Craig Smith


101-103 Fred Taylor Drive:
Features: 3.55ha vacant industrial development site     
Outcome: sold for $10.5 million + gst
Agents: Sean Finnegan (Craig Smith (Colliers) & David Mayhew (JLL)




9 Northside Drive, lot 3:
Features: 720m² childcare centre leased to Eduplay Childcare Ltd
Rent: $390,000/year net + gst + opex
Agents: Sean Finnegan & Craig Smith

Attribution: Agency release.

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Updated: 2 post-auction sales; strong yields for some, no bid on others as 6 sell at Bayleys’ commercial auction

Published 3 August 2017, updated twice on 9 August 2017
Sale of a small character building at the foot of College Hill at Bayleys’ Total Property commercial auction last Wednesday showed the right property could still sell at a yield under 5%.

That was confirmed by the post-auction sale of a Hurstmere Rd property in Takapuna, at a yield just below 4%. Also sold post-auction was a 2-storey building in East Tamaki occupied by a bar & gaming lounge, sold on a 6.5% yield.

Mind you, sub-5%, or even below 4%, isn’t quite a match for the sub-3% yields 2 old converted houses at the top of College Hill went for at auction in June.

Still, there was a buzz in the auctionroom which has been missing from most auctions in recent months, as auctioneers have tried to squeeze an offer from a smattering of mostly reluctant bidders.

6 properties were sold under the hammer at yesterday’s commercial auction. 4 attracted no bid out of the 7 passed in. Another 2 properties on the list had their auctions postponed and one was withdrawn completely.

Finance has become a central issue in all forms of property transaction, and agents told me of numerous new barriers in the way of a sale, such as insistence on tighter lease terms where those terms had previously not even been raised.

Scores of properties have been passed in without attracting a bid at auctions around Auckland this year, but the absence of a bid on the ANZ premises in the Lincoln North shopping centre in Henderson yesterday was in stark contrast to the frenzy of bidding that occurred when developer Frank Reynolds sold the centre down in 2009.

That was about 18 months into the global financial crisis, a time when caution abounded, but it was also a time when there were plenty of Chinese buyers keen on small retail & fast-food premises and willing to bid strongly. With a new 9-year lease in place, the ANZ premises sold in 2009 for $3.03 million at a 5.47% yield. On that day, all 22 units in the centre sold under the hammer.


Victoria Quarter

20 Centre St:
Features: 260m² – 83m² café, 177m² office & showroom,
Rent: $100,000/year net + gst
Outcome: no bid
Agents: Oscar Kuang, Ben Wallace & James Chan

Isthmus east


21 Hall Avenue:
Features: 397m² site zoned business town centre, vacant 269m² building previously occupied by a bank, 5 rear parking spaces  
Outcome: sold for $1.23 million
Agents: Piyush Kumar Peter Migounoff, Tony Chaudhary & Janak Darji


11 Farnham St:
Features: 269m² site, standalone building with 4 levels built 10 years ago, 659m² floor area, private lift to penthouse on top 2 floors, conservatory, 4 bedrooms, 5/6-car garage + secured yard parking on ground floor, partitioned office & amenities on level 1, air-conditioned on levels 1-3
Outcome: auction postponed
Agents: Millie Liang

Isthmus west


1843 Great North Rd:
Features: 2309m² site zoned multi-use commercial with 32.5m height limit, café & villa with 250m² floor area
Rent: $42,898/year net + gst
Outcome: auction postponed
Agents: Laurie Bell & Kate Kirby

Freemans Bay

3 College Hill:
Features: 276m² site, fully leased 592.5m² 3-level character building, retailer Boardertown occupies basement & ground floor, office tenant above, on leases running to 2023 & 2024 plus signage lease
Outcome: sold for $3.075 million at a 4.92% yield
Agents: Cameron Melhuish, Andrew Wallace & Genevieve Thompson-Ford



100 Bush Rd, units C & D:
Features: unit C 245m², Unit D 167m², corner office building, new 6-year lease from 1 June, 15 parking spaces
Rent: $118,575/year net + gst
Outcome: withdrawn from auction
Agents: Laurie Burt & Dean Gilbert-Smith

1 Cebel Place, unit B:
Features: 668m² warehouse, showroom & office unit, 15 parking spaces, Wesfarmers subsidiary NZ Safety Blackwoods renewed its lease for 4 years in June, with one further 4-year right of renewal
Rent: $134,000/year net + gst + opex
Outcome: sold for $2.38 million at a 5.63% yield
Agents: Laurie Burt, Matt Mimmack, Tony Chaudhary & Amy Weng

8 Piermark Drive, unit D:
Features: 401m² industrial unit in modern unit-title development with drive-round access, 265m² of high stud warehousing, 2 levels of showroom & office space, 7 parking spaces
Outcome: sold vacant for $1.3 million
Agents: Laurie Burt & Matt Mimmack


Updated: 178 Hurstmere Rd:
Features: 567m² site, 995m² building with dual frontage to Hurstmere Rd & Killarney St, 2 ground-floor shops, first-floor restaurant & hairdressing salon
Rent: $269,117.76/year net + gst + opex current from 4 tenancies after a lease on vacant space was concluded, (originally I used the rental figure used at the start of the campaign, $159,118, plus potential for further $120,000/year)
Outcome: passed in at $6.5 million, sold post-auction for $6.8 million at a 3.96% yield
Agents: Brian Caldwell, Ashton Geissler & Damian Stephen

Wairau Valley

7 Porana Rd, unit C:
Features: vacant 245m² industrial unit, 5 parking spaces        
Outcome: no bid
Agents: Ashton Geissler & Matt Mimmack

135 Sunnybrae Rd:
Features: 1257m² roadfront site, 683m² partly earthquake-prone warehouse & workshop building, longstanding upholstery tenant recently exercised final 2-year right of renewal, smaller rear tenancy on short lease       
Outcome: sold for $1.625 million at a 5% yield to a car sales business
Agents: Ashton Geissler & James Kidd



The Lincoln North shopping centre.

Lincoln North shopping centre, 192 Lincoln Rd, unit 4A:
Features: 503m², ANZ Bank branch on 6-year lease from December 2015, 3 3-year rights of renewal
Rent: $167,550/year net + gst
Outcome: no bid
Agents: Oscar Kuang & James Chan


7 Maki St, unit 3:
Features: retail unit, NZ Post as tenant
Rent: $112,513/year net + gst
Outcome: no bid, back on the market at $1.725 million + gst
Agents: Andrew Wallace, Cameron Melhuish & Genevieve Thompson-Ford


East Tamaki

Botany South, 8 Bishop Lenihan Place, unit H:
Features: 158m², vacant retail unit in 19-unit complex, 7 allocated parking spaces
Outcome: sold for $580,000
Agents: Terry Kim, Tony Chaudhary & Steven Liu

Updated: 272 Ti Rakau Drive, unit B:
Features: 443m² 2-storey building, 9 parking spaces, bar & gaming lounge on 10-year lease starting in March
Rent: $118,000/year net + gst + opex
Outcome: passed in at $1.6 million, sold post-auction for $1.825 million at a 6.5% yield
Agents: Tony Chaudhary, Janak Darji & Amy Weng


88-94 Great South Rd, unit F:
Features: 1191m² floor area, 6 tenancies fully leased
Rent: $242,000/year net + gst     
Outcome: passed in at $3.5 million
Agents: Piyush Kumar & Peter Migounoff

Earlier stories:
13 June 2017: Sub-3% yields on College Hill, and Queen St office sells
8 July 2009: 22 out of 22 shops go at auction

Attribution: Auction.

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2 mixed-use buildings and a childcare centre sell

Bayleys agents have sold 2 buildings zoned mixed use in Kingsland & Glen Eden, and a new childcare centre at Westgate.

Isthmus west


343 New North Rd:
Features: 372m² site zoned mixed use (height limit 21m), 222m² industrial building with mezzanine storage, constructed in mid 1970s; automotive tenant in occupation for over 20 years, now on month-to-month lease
Rent: $36,000/year net + gst
Outcome: sold for $1.65 million at a 2.18% yield
Agents: Kate Kirby & Stephen Scott


Glen Eden

41 Cartwright Rd:
Features: 2062m² site zoned mixed use, 3 industrial buildings of 345m², 372m² & 527m², one tenanted & 2 vacant, both vacant premises refurbished & ready for occupation; 3-year lease on 372m² building to automotive tenant until August 2019, 2 3-year rights of renewal; residential redevelopment potential longer term
Rent: $24,000/year net + gst
Outcome: sold for $1.7 million
Agents: James Valintine & William Gubb


575 Don Buck Rd, unit 6:
Features: 3998m² site, new 1159m² childcare centre licensed for 110 children; one of 6 units in recently built commercial complex near intersection with Fred Taylor Drive, leased to Learning Tree Childcare Centre for 15 years plus 2 10-year rights of renewal
Rent: $286,000/year net + gst, 3% fixed rental increases every 2 years from November 2020
Outcome: sold for $4.7 million at a 6.08% yield
Agents: Tony Chaudhary, Janak Darji, James Chan & Matt Lee

Attribution: Company release.

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Gunton looks to backdoor-list Retail Property Group through Bethunes

NZ Retail Property Group Ltd owner Mark Gunton announced plans yesterday to backdoor-list the development company through NZX-listed shell Bethunes Investments Ltd.

Bethunes (previously the philatelic business Mowbray Collectables Ltd) said it had signed a non-binding conditional term sheet with NZRPG and its controlling shareholder, Westgate Power Centre Ltd.

NZRPG developed the original Westgate business centre at the top of the North-western Motorway and is developing the second, much larger stage beside the motorway extension, which includes warehousing & industrial uses as well as a new mall & business centre (pictured above).

Mark Gunton.

Mr Gunton’s company also owns 2 North Shore malls where it’s adding residential capacity, at Milford & Birkenhead.

Bethunes summarised the listing transaction thus:

  • Bethunes would transfer all its assets (except for $100,000 in a series of bonds and some cash) into a wholly owned subsidiary, BIL 2016 Ltd (New BIL)
  • New BIL’s shares will then be distributed pro rata to all of Bethunes’ existing shareholders
  • New BIL will assume the name Bethunes Investments Ltd
  • The business of NZRPG will then be reverse-listed into the resulting shell of Bethunes through Bethunes issuing shares to Westgate in exchange for all of the shares in NZRPG
  • Bethunes will then assume the name NZ Retail Property Group Ltd
  • For Bethunes shareholders, the effect if the transaction is completed is that they will retain their current Bethunes shares, which become an interest in NZRPG, but will also, for no consideration, receive shares in New BIL, which will be an interest in the same assets & business plan that BIL presently has.


The initial indicative & non-binding estimates for the transaction are:

  • The shares in NZRPG are estimated at about $400 million
  • The shares in Bethunes (less the assets & receivable held in BIL 2016 Ltd) on a debt-free basis are valued at $1 million plus the NZX bond of $75,000 & $25,000 cash
  • Based on these valuations, Westgate will hold about 99% of the share capital in Bethunes. These values are subject to final determination & agreement and may vary.


The transactions contemplated by the term sheet are conditional on:

  • Bethunes conducting a due diligence investigation of NZRPG
  • Westgate conducting a due diligence investigation of Bethunes
  • Entry into legally binding transaction documents between Bethunes & Westgate
  • Obtaining any necessary waivers from NZX required to proceed with the transaction
  • Bethunes obtaining all shareholder approvals that may be required to undertake the transactions, including under the Companies Act, the Takeovers Code & the NZX listing rules.

Bethunes shareholders must approve deal. They’ll get an independent report and an appraisal report, and Bethunes intends to call a shareholder meeting by 30 June, with the intention of completing the transactions shortly after approvals are obtained.

Bethunes chair Chris Swasbrook  said the Bethunes board was investigating either re-listing New BIL following the transactions or placing New BIL on an alternative share trading platform to retain some liquidity in New BIL. A decision on this will be made before shareholders are asked to vote on the NZRPG transaction.

NZRPG’s business

NZRPG is a retail property developer, owner & manager. It has over 100,000m² of leasable space in its portfolio.

Its intention in listing is to grow its investment portfolio through the strategic development of existing retail centres into planned town environments, and the development of mixed use assets that derive the highest value/m².

The company said: “Historically income generated from property assets has, to a large part, been utilised to fund the ongoing development, planning & design processes necessary to ensure the long-term opportunity for these town centres. As a result, NZRPG is now uniquely positioned with a significant & long-term development pipeline, which will provide long-term income & value growth.

“NZRPG is seeking capital to realise these plans, and a reverse listing is intended to support securing new capital. NZRPG is presenting to investors the opportunity to take part in one of the most significant retail property development pipelines in New Zealand. The company is seeking capital to embark on the next phase of its pipeline, which includes one of New Zealand’s biggest mixed use property development opportunities – Westgate town centre.

“In addition to the ongoing completion of the 48.5ha Westgate town centre, both the Milford centre & Highbury centre are undergoing retail development with a residential overlay. The success of these developments is underpinned by the expansive urban town planning that is reshaping Auckland.

“These growth opportunities include the provision of residential overlays to all the town centre properties (Milford, Highbury & Westgate) which will both enhance the retail performance of the centres and allow for significant tranches of capital to be recycled into the core business. The Milford development plan is underway, with completion due in mid-2019.”

Swasbrook’s top table links

Bethunes chair Chris Swasbrook is managing director & founding shareholder of the manager of Elevation Capital Ltd. Precinct Properties NZ Ltd chair Craig Stobo chairs Elevation’s manager and is a shareholder, and corporate legal advisor Andrew Harmos is a non-executive director & shareholder.

Mr Swasbrook was previously a partner of Goldman Sachs JBWere Pty Ltd and co-head of institutional equities at Goldman Sachs JBWere (NZ) Ltd.

Mr Stobo has worked as a diplomat for the New Zealand & Australian governments, as an economist, investment banker and as chief executive & executive vice-president of BT Funds Management NZ Ltd.

Mr Harmos is a founding partner of specialist corporate legal advisory firm Harmos Horton Lusk Ltd, formed in 2002 after his 16 years as a partner of Russell McVeagh. He’s also a director of ASX-listed Scentre Group Ltd.

NZ Retail Property Group
Elevation Capital

Earlier stories:
15 February 2017: Auditor-general argues for more Westgate deal disclosure but doesn’t see wrongdoing
25 May 2016: Milford shopping centre expansion approved
22 February 2013: Gunton gutted by Milford decision but will fight on
1 February 2010: Retail Property Group puts 48 units up for sale
18 November 2009: Opposition pushes Massey North start out 8 years from conception
19 December 2008: Expanded Westgate a new Newmarket?
Attribution: Company release.

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Auditor-general argues for more Westgate deal disclosure but doesn’t see wrongdoing

Auditor-general Lyn Provost told Parliament yesterday, in a report tabled on dealings between the Waitakere City and Auckland Councils and Westgate landowner NZ Retail Property Group Ltd (NZRPG), that both councils could have made better disclosure. But she did not disclose any wrongdoing in the financial arrangements.

Image above: The Westgate layout looking down the North-western Motorway toward Henderson, as it was in 2013.

The Auditor-general’s office looked into specific aspects of Auckland Council’s project to develop a new town centre in Massey North (the council name for what NZRPG always called Westgate) after several people raised concerns about the establishment & management of this new town centre. They questioned whether the public & private costs & benefits of the project had been appropriately balanced between Auckland Council & a private developer.

Auditor-general Lyn Provost.

Mrs Provost said the focus of the office’s inquiry was on Auckland Council’s management & governance of the project from 1 November 2010, when the newly amalgamated council inherited the project from the now dissolved Waitakere City Council.

“One of the concerns raised with us was about the lack of transparency, in particular being unable to access information about the project. In our view, Auckland Council could have made more information about this development available. It is important that local authorities strike the right balance between balancing commercial sensitivity, maintaining legal privilege as appropriate and being open with ratepayers & elected officials. Such openness allows public discussion & debate, and is essential to supporting public sector accountability. This exercise has highlighted once again the importance not just of making good decisions but also of being able to show that good decisions have been made.”

The background

A block in the first Westgate stage, pictured in 2012.

Companies in the NZRPG group owned or controlled much of the land where the new town centre was to be located. As a result, Waitakere City Council entered into a memorandum of understanding with NZRPG in 2004 to establish a collaborative working relationship to design & develop the town centre. In 2010, the council & NZRPG entered into a suite of contractual arrangements for the actual development of the new town centre and the sharing of the costs between them.

“While the focus of my inquiry was on Auckland Council’s management & governance of this project from 2010 onwards, concerns were also raised about Waitakere City Council’s decision to pay the developer $6 million for a street in the existing Westgate shopping centre. Concerns had been raised about this purchase because, usually in a new development, a developer will bear the cost of constructing roads – which then vest in the council at no cost when land is subdivided.

“Accordingly, in order to provide sufficient context, my report sets out additional background detail about the decision-making process undertaken by Waitakere City Council in relation to the purchase, and the basis on which the purchase price was agreed.

“Concerns were also raised with my office about the contractual arrangements between Waitakere City Council (and, subsequently, Auckland Council), Transpower & NZRPG to relocate transmission lines passing over the development, underground. Waitakere City Council entered into an agreement with Transpower to pay the costs of the relocation.

“The evidence supports the need to relocate the power lines for the development of the town to proceed.

Development in 2015: The first stage of the North-west shopping mall completed, ground works started for stage 2 and the public square, Te Pumanawa.

“In the agreement with Transpower, Waitakere City Council accepted the primary responsibility to pay all the cost of relocating the lines – that is, its own 35% & NZRPG’s 65% share of the cost. The share of the costs to be paid by NZRPG would be recovered under a separate agreement between Waitakere City Council & NZRPG.

“Waitakere City Council was clearly aware that, in accepting the primary payment risk, it needed to protect its position in case NZRPG failed to pay its share of the costs. It put in place several mechanisms to provide this protection, including an offsetting agreement.

“Importantly however, although Auckland Transition Agency confirmed the agreement with Transpower, it did not confirm the offsetting agreement. As a result, the agreement with NZRPG to pay its share was legally invalid. As a result, the council was party to a binding contract to pay the full costs of relocating the power lines without having a corresponding binding contract in place to recover NZRPG’s share of the costs from NZRPG.”

Auckland Council inherited the project and the issue relating to the legal invalidity of the agreement, and resolved this issue by entering into a new agreement with NZRPG to share the costs.

“However, in 2012, it then decided to postpone NZRPG’s obligation to pay its share. Council documents indicate that this decision was made because it perceived a risk to the progression of the project. The result of this decision has been that the financial risk borne by the council & its ratepayers will continue until such time as NZRPG’s contribution has been fully paid. As at 20 September 2016, NZRPG had paid about $3 million of the $11.3 million it owed to Auckland Council.”

Mrs Provost said Waitakere City Council carried out several infrastructure works at its own expense, as part of its contractual relationship with NZRPG. This included construction & widening of roads, the development of intersections, provision of water supply & wastewater services, and the design & construction of the town square & library. “The intention was that the council would subsequently recover some of the costs associated with this work through development contributions to be paid by the developer….

“The calculation of development contributions in this project was not straightforward, given the complexity of assessing the balance between the public & private benefits of the development. We have been unable to ascertain or calculate the value of the development contributions, but expect it to be a significant amount of money.”

On 28 October 2010, days before Auckland Council took office, Waitakere City Council reached an agreement with NZRPG to vary the amount & timing of payments of development contributions.

This was recorded in an exchange of letters over 2 working days, but Mrs Provost said the Auckland Transition Agency didn’t confirm the decision.

“Auckland Council subsequently entered into an agreement with NZRPG to formalise the development contributions arrangements. The agreement provides for the offsetting of some of the development contributions owed, as well as the postponement of when some development contributions are to be assessed & paid.

“While there are still development contributions payable by NZRPG before the end of the project, Auckland Council has taken on a greater risk at this stage in the project by the postponement of these payments. Whether the final amount of development contributions is appropriate will need to be weighed up as part of the overall balance of costs between the parties at the conclusion of the project.”

Specific steps taken by Auckland Council

Once Auckland Council became responsible for the project, Mrs Provost said it immediately sought legal advice on the agreements it had inherited.

“It became clear that the Auckland Transition Agency had not confirmed all of the agreements, which was a prerequisite for transfer to Auckland Council. Auckland Council signed replacement agreements to ensure that they were all legally valid. In October 2011, the regional development & operations committee of Auckland Council agreed that a review into probity issues raised at the committee be conducted and that the review be reported back to the committee for further consideration. Auckland law firm Meredith Connell was commissioned to undertake that review.

“In my view, commissioning this review was good practice given the complicated matrix of arrangements between the former Waitakere City Council & NZRPG. The review put Auckland Council in a good position to understand the obligations it had inherited and any risk that it might need to manage.

“The Meredith Connell review was summarised & discussed at the public-excluded part of the June 2012 regional development & operations committee meeting. The committee agreed that the report & associated resolutions remain confidential until the reasons for confidentiality no longer exist.

“Auckland Council has since improved the contractual arrangements with NZRPG, including linking payments more directly to the delivery of work and instituting a better procurement process for subcontractors working on the new town centre.”

Auditor-general’s conclusions

Mrs Provost concluded: “The amount of information provided to the elected members of Auckland Council on this development could have been more comprehensive. Councillors have been concerned about the project and should not need to resort to me to get answers.

“In my view, the risks involved with this development warrant greater involvement by Auckland Council’s governing body in overseeing the project, including its costs. More information & clarity about the issues that management need to refer to the governing body would help this oversight.

“Public concerns have been raised with my office, and directly with Auckland Council, about the lack of transparency with this development. My office received complaints from members of the public who have been unable to access information about the project, including the Meredith Connell report. Similar concerns have been expressed to my office by council members.

“It is important that local authorities strike the right balance between balancing commercial sensitivity, maintaining legal privilege as appropriate and being open with ratepayers & elected representatives to provide transparency about the agreements they enter into and to demonstrate that they are getting value for money. Such openness allows public discussion & debate, and is essential to supporting public sector accountability.

“In my view, Auckland Council could have made more information about this development available. Auckland Council obtained the Meredith Connell advice on a confidential basis and has treated the report as legally privileged & commercially sensitive.

“Given the public interest and that commercial sensitivity has likely reduced with the passage of time, I encourage Auckland Council to consider what information it could now release – including all or some of the Meredith Connell report.”

Auditor-general’s statement & report

Attribution: Auditor-general’s office.

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Plan change 15 for Westgate & plan change 36 for Waitakeres fully operative Monday

Waitakere plan change 15, for Massey North, will become operative on Monday 21 October.

A second Waitakere plan change to become operative the same day, No 36, is for rural activities and the social, cultural & economic well-being of the people & communities in the Waitakere Ranges heritage area.

Parts of plan change 15 were made operative in November 2011 and July & November 2012. The last to become operative are amendments to policies, rules & the district plan maps for Massey North’s precinct E.

Plan change 15 was one of 3 introduced for areas across the top of the Waitemata Harbour, in the former Waitakere City Council’s push to create new business & residential zones. Under this plan change, the employment special area of the total 156ha new zone for the new Westgate town centre has been sequenced & prioritised for industrial & employment development, including large-lot development for manufacturing, construction, wholesale trade, transport & storage.

Plan change 36 was one of 4 notified by the old Waitakere City Council in 2010, 2 covering outer areas and 2 covering Titirangi Village & New Lynn. Plan change 36 is intended to improve regulatory provisions within the Waitakere Ranges heritage area associated with rural activities, the enabling of future uses of rural land to retain a rural character, and to provide for social, cultural & economic wellbeing. It amends rules in the foothills, bush living, coastal village & Waitakere Ranges environments.

Plan change 35 was for the Waitakere Ranges heritage area, Oratia local area plan, Waiatarua local area plan & Oratia rural village; plan change 37 was for Titirangi Village and variation 1 to plan change 17 was for New Lynn.

Attribution: Council notice.

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