Tag Archives | Argosy

Argosy restructures debt

NZX-listed Argosy Property Ltd has restructured its syndicated bank facility with ANZ Bank NZ Ltd, Bank of NZ Ltd and Hongkong & Shanghai Banking Corp.

Chief executive Peter Mence said today:

  • The expiry of tranche A ($275 million) has been extended to 31 October 2021
  • Expiry of tranche B (also $275 million) remains at 30 September 2020
  • An additional tranche (tranche C) of $25 million has been added to the facility with an expiry date of 31 October 2021. The total facility is now $575 million.

As at 31 May, Argosy’s weighted average cost of debt, including line fees, margin & interest rate swaps, is expected to be about 5.1%/year and the weighted average debt expiry will be 3.9 years.

Attribution: Company release.

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Panuku to move to former IBM space on Wyndham St

Argosy Property Ltd has reached an agreement to lease 2657m² on the ground & first floors of the former IBM building at 82 Wyndham St in central Auckland to Auckland Council’s property arm, Panuku Development Auckland, which has been based at Westhaven.

The 9-year lease term will start in August and has a break clause (with penalty) at 6 years.

Long-term tenant Boffa Miskell occupies the top floor on a recently renewed lease, leaving one 1575m² floor still available. Argosy chief executive Peter Mence said yesterday the company had had good inquiry from marketing of the remaining floor, which will be available for occupation in 2018.

Argosy is completing an extensive $9 million refurbishment of the entire Wyndham St building to a minimum 4 green star built rating and is targeting a 4 star Nabers NZ energy efficiency rating.

Following the upgrade, Mr Mence said the building would provide very efficient, cost-effective space and an attractive working environment for tenants: “New services will include facilities to encourage cycling to work, an increase in the building’s fresh air supply, a smart lighting system linked to automatic blinds, a window film that improves solar conversion, a variable refrigerant flow air-conditioning system and the latest water-saving & metering systems to enable usage to be measured for Nabers NZ.

Panuku chief executive Roger MacDonald said one objective of the move was to be closer to the Auckland Council headquarters on Albert St: “Currently the Panuku offices at Pier 21 on Westhaven Drive are about 25 minutes away by foot.”

He said Panuku would make a number of long-term savings from moving into a refurbished building.

IBM has moved to 2 floors in the new Bayleys House at 30 Gaunt St in the Wynyard Quarter, behind Fonterra Group Ltd’s Fanshawe St premises and a block from the GridAKL innovation hub.

The Fonterra & Bayleys buildings are in the Wynyard Precinct Holdings Ltd portfolio held by a joint venture between the Goodman Property Trust & Singapore sovereign wealth fund GIC.

Attribution: Argosy & Panuku releases, Goodman website.

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Corrected: Argosy sells Dalgety Drive property to owner-occupier

Published 21 March 2017, yield detail added 22 March 2017
Argosy Property Ltd has disposed of the industrial property at 67 Dalgety Drive in Wiri for $6.85 million, which the company said was a 44% premium to its most recent book value.

The company did an interim revaluation of its portfolio last September, for the first time since 2009, and that valuation of $4.45 million put the passing yield at 8.38%. The sale price is 54% up on that. The building has a net lettable area of 3698m².

Chief executive Peter Mence said yesterday Argosy classified the property as non-core. The buyer is a private company which will operate from the site once the lease of the current tenant, RLA Polymers Ltd, expires on 31 March.

Attribution: Company release, calculator.

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Argosy says delayed quake insurance payout won’t hurt dividend

Argosy Property Ltd said on Friday it had a $50 million estimate of the cost of reinstating the quake-affected NZ Post House in Wellington, based on a preliminary scope of works.

The building at 7-27 Waterloo Quay sustained damage to building services in the 7.5-magnitude Kaikoura earthquake on 14 November 2016. Argosy chief executive Peter Mence said independent engineers had confirmed that the building remained structurally sound, but significant replacement of fitout & services was required. NZ Post has reoccupied the ground floor & 4 other levels.

Mr Mence expected the damage to the building services & fitout to levels 1-4 & 7 would be repaired during the next financial year. Argosy has lodged a claim for the reinstatement cost & associated loss of rents under its material damage & business interruption insurance policy (less a $4.8 million deductible).

Under New Zealand accounting standards, Argosy can’t include expected insurance proceeds in its financial results until the proceeds are quantified & agreed. Mr Mence said that if they weren’t included, the loss of rents for the current year would have a net after-tax impact of about $1.85 million, or 0.23c/share in the period to 31 March 2017.

“This will have no impact on the March 2017 full-year dividend, which as previously announced is expected to be 6.1c/share and be fully paid from net distributable income for the year.”

Attribution: Company release.

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Argosy sells land next to Albany Mega

Argosy Property Ltd has entered into an unconditional agreement to dispose of about 14,600m² of vacant land at 258 Oteha Valley Rd in Albany for $11.65 million.

The land sits next to the Argosy-owned Albany Lifestyle Centre (the Centre), a 25,000m² split-level bulky goods retail centre.

Chief executive Peter Mence said today settlement was expected to occur in late February.

Argosy has also extended the lease of the Mitre 10 Mega store in the Centre by a further 8.5 years, taking the expiry of this lease out to 2032. As part of the lease extension, Argosy has committed to spending $3.1 million to extend the existing Mitre 10 Mega store into the garden centre and provide about 405m² of extra retail space on the upper level of the Centre.

Attribution: Company release.

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Argosy settles Wiri purchase

Argosy Property Ltd has settled its acquisition of the industrial property at 240 Puhinui Rd, Wiri.

Chief executive Peter Mence said on Friday the new design/build property had identical design & specifications to the very high modern standard of the adjacent Argosy-owned property at 19 Nesdale Avenue.

Both properties are occupied by Cardinal Logistics Ltd, with matching 15-year leases in place.
Argosy signed to buy 240 Puhinui Rd in November 2015 for $22.6 million on completion of the new design/build facility for Cardinal.

Earlier story:
30 November 2015: Argosy buys twice in Wiri

Attribution: Company release.

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Argosy leases Bunnings space on Ti Rakau

Argosy Property Ltd has leased the 11,675m² of warehouse space at 320 Ti Rakau Drive before the Bunnings distribution centre lease on the premises expires. It’s also filled vacant Greenlane space.

Argosy chief executive Peter Mence said yesterday: “The Bunnings distribution centre lease was one of Argosy’s key expiries remaining in the current financial year and it is very pleasing that we have been able to successfully lease this space to 2 quality tenants, both on new 10-year lease terms.”

Target International NZ Ltd is to lease 6567m² of the warehouse, plus 447m² of office space, which will serve as its head office.

Gunnersen Ltd, the largest independent Australian-owned distributor of wood-based panel products, timber & decorative surface materials, will lease the remaining 5108m² of warehouse area, plus 150m² of office.

Argosy will undertake $5.2 million of capital works to develop the site to facilitate the warehouse subdivision and to improve truck circulation & yard management.

Mr Mence said Bunnings was expected to remain in the warehouse on a monthly basis until the new year. The Bunnings retail store isn’t affected and will continue to trade as normal.

Greenlane space leased

Argosy has also leased the vacant 1150m² on 2 levels at 308 Great South Rd, Greenlane, to Housing NZ Corp, which has recently extended its lease at Argosy’s 626 Great South Rd property.

The 308 Great South Rd space was fully refurbished after Pacific Brands relocated to an adjoining Argosy building. Housing NZ’s lease on it is for 3½ years from 1 January.

Attribution: Company release.

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Argosy has 2.6% revaluation gain

The value of Argosy Property Ltd’s property portfolio rose by $35.8 million (2.6%) for the 6 months to 30 September, following an interim desktop review by independent valuer Colliers International.

That took the value to $1.4 billion, excluding properties held for sale.

Argosy chief executive Peter Mence said last week the increase in values was primarily due to the firming of market capitalisation rates & market rental growth.

The portfolio by region and then by sector, showing valuation at 30 September, 6-month change in value & percentage, and the market yield (with March yield in brackets:

Auckland: $954.8 million, up $34 million (3.69%), yield 7.12% (7.38%)
Wellington: $371.9 million, down $0.8 million (0.22%), yield 7.58% (7.65%)
North Island regional & South Island: $78.2 million, up $2.6 million (3.47%), yield 8.1% (8.71%)
Total: $1404.9 million, up $35.8 million (2.61%), yield 7.3% (7.53%).

And the portfolio by sector:

Industrial: $540.7 million, up $29.9 million (5.86%), yield 7.26% (7.69%)
Office: $550.6 million, down $0.5 million (0.1%), yield 7.55% (7.62%)
Retail: $313.6 million, up $6.4 million (2.08%), yield 6.92% (7.09%)

Attribution: Company release.

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Warehouse takes over ex-Dick Smith premises in Wiri

Argosy Property Ltd has confirmed the long-term lease of 17 Mayo Rd in Wiri to The Warehouse Ltd, an existing Argosy tenant.

The new lease is for a 10-year term over the entire property (13,350m² net lettable area), with annual CPI rent reviews.

Argosy chief executive Peter Mence said on Monday the property was previously occupied by Dick Smith, which left in April after entering receivership. Since then, Argosy has leased the property to various tenants on a short-term basis.

The Warehouse lease is due to start in early 2017.

Attribution: Company release.

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Argosy to add development on Hutt Rd site

Argosy Property Ltd has reached an agreement to redevelop the property at 180 Hutt Rd, Kaiwharawhara, Wellington.

Argosy has conditionally entered into a new 9-year lease with Fletcher Distribution Ltd for its continuing use by Placemakers, while also allowing for development of part of the site.

Placemakers will occupy a net lettable area of 3713m² and Argosy will develop an additional 1100m² of retail space. The redevelopment remains subject to resource consent.

Argosy chief executive Peter Mence said on Wednesday the 15-month redevelopment had an estimated cost of $9.39 million. The market value of the property on completion was expected to be $18.8 million, with a yield on cost of 7.26%.

Mr Mence said the redevelopment was consistent with Argosy’s strategy of adding value to existing assets & tenant-driven expansion.

Attribution: Company release.

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