Wellington, 8 August 2014 – One of Wellington’s truly prime parcels of waterfront real estate, the 12-storey tower building in Wellington’s ‘dress circle’ at 1 Victoria Street, has come up for sale on the open market.
Marketed by Ryan Johnson, Managing Director of CBRE Wellington on behalf of Arawata Assets Limited (ANZ Bank NZ Limited), the office and retail property and 20 car parks in the adjourning Victoria Street car parking building are for sale by closed tender closing 4pm on 10 September 2014.
The building was initially the head office of South Pacific Merchant Finance and was called Southpac House. Occupying a 721sqm site on the central CBD corners of Victoria Street, Hunter Street and Jervois Quay, the building offers unobstructed views over the Inner Harbour that also extend up the Hutt Valley.
The sale by the bank is part of its wider accommodation strategy in Wellington. ANZ is strengthening its presence by consolidating the number of properties from nine to four, having signed a new lease for 171 Featherston Street, formerly HP Tower, initiating an upgrade of 170 Featherston Street and recently opening a new branch in Willis Street. The bank has 3000 staff and 25 branches in the Wellington region. Around 1200 support staff are based at ANZ’s biggest Wellington site in Tory Street, with a further 350 Technology staff based at Vivian Street.
Constructed in 1983 as part of an overall development that included the Victoria Street car parking centre, the building offers 6,725sqm of net lettable area over 12 levels of offices, including a penthouse level with an executive boardroom, plus a ground floor showroom retail area at the northern end of the building.
The fully-sprinklered structure has a B seismic rating, which has been provided through a detailed seismic assessment undertaken by Beca. The building score could likely be raised to an A rating with some minimal seismic works undertaken on the southern wall, says Mr Johnson.
“Part of the city’s skyline, it offers so much for any investor or occupier seeking not only a prime waterfront position but also a tremendous redevelopment opportunity. The property also holds accompanying air rights over the Victoria Street Car Parking Building making this a powerful combination for a premium position on the Wellington Waterfront. Along with these attributes the property is also being sold with 20 car parks which are part of the neighbouring Victoria Street Car Park Centre.
“Given the changing accommodation requirements of ANZ, the building will become vacant as the bank moves to its new premises over the next 18 months. The impending vacancy will be mitigated somewhat with ANZ occupying until departure mid to late 2015. With close to 18 months before the bank leaves in its entirety, there is ample opportunity for a new owner to realise a redevelopment plan and seek tenant interest in this outstanding location.”
Zoltan Moricz, Senior Director of Research for CBRE, says that the firm’s most recent research shows that the availability of Prime Wellington stock continued to tighten during the first half of 2014.
“We are seeing very low Prime vacancy, which is leading to spill-over interest into secondary stock. This demand is pushing up rents
“This is forecast to tighten for buildings in strategic locations that also have a NBS rating of 100%. With the building achieving both of these attributes it is likely that there will be strong demand for the available floors, which suit the small to medium occupier market.
“Premium Grade stock remains virtually fully leased, although some sub-lease opportunities are available. At the same time, Grade A stock has seen a vacancy reduction of 2.1% to 1.6%, and the CBD Core experienced a 3.1% reduction.
“The availability of good quality, seismically acceptable space will remain tight over the medium term. The last eighteen months have seen a surge in leasing activity as tenants relocated from inferior buildings, particularly those with seismic issues. This flight to quality has resulted in an immediate shortage of decent options for mid to large sized tenants seeking space for occupation over the next few years, allied to a limited number of potential new developments in the supply pipeline.”
About CBRE
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (in terms of 2013 revenue). The Company has approximately 44,000 employees (excluding affiliates), and serves real estate owners, investors and occupiers through approximately 350 offices (excluding affiliates) worldwide. CBRE offers strategic advice and execution for property sales and leasing; corporate services; property, facilities and project management; mortgage banking; appraisal and valuation; development services; investment management; and research and consulting. Please visit our website at www.cbre.com.
