The joint venture between the NZX-listed Goodman Property Trust & Singapore sovereign wealth fund GIC Pte Ltd has added Bayleys House in the Wynyard Quarter to its portfolio.
That acquisition for $62.3 million, and the $86.2 million purchase of the neighbouring Datacom Building, which settled on Friday, take joint venture company Wynyard Precinct Holdings Ltd’s portfolio to 7 buildings worth over $470 million.
The recently completed 6-storey 8106m² Bayleys House backs on to the Fonterra Centre, also in the portfolio. Fonterra at 109 Fanshawe St, and Bayleys at 30 Gaunt St, also front Halsey St in the VXV Precinct which has been developed by ASX-listed Goodman Group on leasehold land owned by Viaduct Harbour Holdings Ltd.
The 7-storey 16,735m² Datacom building is across VXV Plaza from Bayleys, on the corner of Gaunt & Daldy Sts.
John Dakin, chief executive of the Goodman trust’s manager, Goodman (NZ) Ltd, said the partnership strategy provided scale for the trust and gave it greater exposure to Auckland’s fastest-growing commercial precinct.
“Featuring large flexible floorplates and incorporating sustainable architectural elements & energy-efficient building systems, the lowrise office property is designed to a 5 green star rating. It is also expected to achieve a 5-star NabersNZ base building rating when assessed in 12 months’ time.”
Predominantly leased to real estate specialist Bayleys, technology provider IBM & law firm Mayne Wetherell, Bayleys House’s leases incorporate fixed review structures and have a weighted average term of 9 years. The ground-lease obligations are structured for a period of 15 years.
Goodman Group undertook the development on a build-to-lease basis. The purchase price reflects an initial yield of 7.6% on contract rentals, and additional fitout rent increases the passing yield to 8.8%.
The acquisition, which remains conditional on the approval of the landowner, is expected to settle in June.
On settlement, the joint venture’s portfolio will contain 88,000m² of office space for about 20 tenants. When future lease commitments are incorporated, the portfolio will have an occupancy rate of 96% and a weighted average lease term of over 9 years.
27 March 2015: Fletcher & Goodman sign up for new Wynyard Quarter building
7 November 2014: Goodman Group buys another Wynyard development block
Attribution: Company release.