Archive | Office

Minister says Crown property focus saves $57 million in year

State Services Minister Paula Bennett quoted an unpublished report yesterday to say more efficient use of office space and the sharing of facilities by government agencies had saved taxpayers $57 million in the last financial year.

Mrs Bennett was citing the fifth Crown office estate report by the Government’s Property Management Centre of Expertise, which she said showed the Government was continuing to reduce its property footprint while ensuring its employees were in modern, safe & healthy work environments.

“In the year to 30 June 2015, the Crown estate footprint was reduced by 30,997m². This takes the total reduction to 152,293m² since 2011, a saving of $132 million to taxpayers.

“The Christchurch integrated government property programme also delivered its first building. This is not only supporting the revitalisation of Christchurch’s business centre but is also creating a more collaborative relationship between government agencies.”

Mrs Bennett said the centre of expertise’s focus on helping agencies work together more closely was an important part of delivering better public services: “This collaboration & the modernisation of workplaces also supports greater productivity, resulting in better services for the public. By reducing the office space the Crown uses and using the spaces it has more efficiently, our government is on track to save about $110 million annually by 2023.”

The link below takes you to the centre of expertise’s section of the Ministry of Social Development website, where I’m sure the latest report will appear in due course.

Property Management Centre of Expertise

Attribution: Ministerial release.

Continue Reading

State office space down 55,500m² in year

State Services Minister Paula Bennett said yesterday the Government had reduced the space it leases by the equivalent of 7 rugby fields in 4 years.

One thing it hasn’t achieved yet, though, is faster production of its reports on this performance. The fourth Crown office estate report released by the Government’s Property Management Centre of Expertise yesterday is for the year to June 2014.

It shows the Government had reduced its office footprint by 121,433m² since 2011, and by 55,514m² in the most recent year to 1.6 million m².

The total cost of the estate fell by $2 million to $326 million, and the number of people accommodated fell by 90 – from 63,696 to 63,606.

Statistics the centre produced showed:

  • The average space occupied by an office person remained static at 19.2m²
  • Space/office workstation increased from 16.6m² to, 16.7m²
  • The average cost/office person (rents only) was $5356, compared to $5137 in the private sector, and
  • The average total cost across the Government fell from $6840/person to $6668/person.

Mrs Bennett said: “People don’t live their lives the way our institutions so often frame them, with different departments or agencies working separately from one another.

“Across the board, we are breaking down the silos that have held the public sector back from being positioned to provide the outstanding services modern New Zealand needs & expects.”

She said the centre had helped 18 agencies work together on colocations last year.

“We are still on track to reduce the cost of property holdings by around $110 million by 2023, by reducing the office space we take up and becoming more efficient in how we use that space. Putting it another way, over the next 10 years the Government is on track to free up space equivalent to the size of the Reserve Bank Building.”

Links: Property Management Centre of Expertise
Fourth Crown office estate report

Attribution: Ministerial release, centre report.

Continue Reading

Wairau Valley development site sells

A large Wairau Valley development site was sold for $5 million last week through a tender run by Bayleys. Bayleys North Shore agents have also completed 3 new leases.



Wairau Valley

202 Wairau Rd:
Features:7136m² vacant site zoned business 9 on 2 titles
Outcome:sold for $5 million at $700/m² on 23 May
Agents:Ranjan Unka, Trevor Duffin & Nick Howe-Smith




4 Civil Place, unit D:
Features:214m² office/warehouse – warehouse 124m², office 90m²
Rent: $30,000/year net at $140/m², leased in April
Agents:Laurie Burt

19 Orbit Drive, unit D:
Features:942m² office/warehouse
Rent: $117,500/year net at $124.73/m²
Agents:Matt Mimmack, Laurie Burt & Ranjan Unka


215 Rosedale Rd, unit M:
Features:245m² office, 7 parking spaces
Rent: $36,666.67pa + gst + opex at $149.66/m²
Agents:Tonia Robertson & Alex Strever

Attribution: Agency release.

Continue Reading

Albany Toyota property sold

Bayleys’ North Shore office has started 2013 with one sale at albany and 4 leases in Takapuna reported.



252 State Highway 17 & 8 Gills Rd:
Features: 2107.1m² mixed-use property leased to Albany Toyota (Eastern Wholesale Ltd)
Rent: $381,500/year
Outcome: sold for $4.77 million at an 8% yield
Agents: Daryl Devereux & Brian Caldwell



9 Huron St:

Features: 680m² office with 10 parking spaces
Rent: $135,000/year
Agents: Christina Heaven

31 Northcroft St, unit G7:
Features: 100.6m² office with 3 parking spaces
Rent: $23,215/year
Agents: Christina Heaven

95 Hurstmere Rd level 3, unit 3:
Features: 19.36m² office with one parking space
Rent: $21,319/year
Agents: Christina Heaven

9 Huron St:
Features: 680m² office with 10 parking spaces
Rent: $135,000/year
Agents: Christina Heaven

Attribution: Agency release, story written by Bob Dey for the Bob Dey Property Report.

Continue Reading

Wellington office beat Auckland’s in 2009, says JLL’s Lester

Published 18 January 2010

Wellington’s office market significantly outpaced Auckland’s in 2009, bestowing it with the title of New Zealand’s property capital, says Jones Lang LaSalle’s Wellington director of property management, Justin Lester.


Mr Lester said investors were better placed in Wellington to focus their attention on market fundamentals, proactive management strategies & consolidation rather than growth, due to the large & stable Government presence, restricted supply due to the city’s physical constraints and reliable tenant income.


He said Wellington owners fared better on occupancy levels, which helped insulate rental returns & investment yields.


In Auckland, vacancy rates climbed to 13% (prime to 13.2%, secondary to 12.7%). In Wellington, though, vacancy had stopped short of 5% (prime 3.5%, secondary just under 8%).


“The collapse of the finance sector in Auckland and the retrenchment of associated businesses are the primary reason for the significant increase in vacancy. Wellington has been relatively stable in comparison due to fewer company failures, the ongoing influence of the Government sector and smaller exposure to international corporates.


“Our analysis in both cities shows that landlords are slowly coming to terms with potentially negative future prospects and are being more proactive in their retention & attraction strategies. One way has been the increasing financial incentives.


“In Wellington, current incentives equate to around one month rent free for every year of the lease term, or about 8-10% of the annual rent. In Auckland, this is closer to 1½-2 months rent free/year of the lease or about 16-17% of annual rent, principally due to the higher level of vacancy & competing landlord interests.


“The increased incentives have had a significant effect on net effective office rents. In 2009, Auckland net effective rents decreased by about 20% for prime cbd offices. Wellington also experienced a rental decline, but in the vicinity of 12%.


The 20% decline in Auckland net effective rents now has rents at the top end at $374/m². The net effective decline in rents in Wellington was 6% over 2009 and sits at $322/m².


“Landlords endeavouring to preserve capital values are resisting further rental drops by offering smaller incentives or seeking to maintain existing market rents, but landlords with stricter cashflow requirements are more willing to meet tenant demands and are bringing the wider market average down.”


Jones Lang LaSalle agency director Steve Rodgers said prime cbd office yields in Wellington’s better performing market had softened at a much slower rate than Auckland’s: “Wellington office yields softened by around 100 basis points since the peak in the cycle compared to 150 basis points in Auckland.”


He said the concerns surrounding occupier demand in Auckland were the primary factor for the increased softening in Auckland yields. Major Auckland transactions included Forsyth Barr Tower for $41.5 million at an initial yield of 9.5%, the Imperial Building for $22 million at an equivalent yield of 8.5% and 4 Viaduct Harbour Avenue for $26.6 million at a 10.4% yield. In Wellington, there have been 3 sales of $19 million or more at or around a 7.4% yield and 2 more close to 8.2% in 2009, which Mr Rodgers said reflected the more stable environment, the stronger tenant covenant & the stability of long-term leases.


However, Jones Lang LaSalle believed Wellington’s medium-term outlook was more uncertain. Among its many challenges, the Government required its agencies to reduce operating costs by 10% and significantly reduce cbd office occupation. In spite of this, a number of new developments were being constructed or proposed.


Mr Lester said Wellington’s net lettable office space might increase by 29% between now & 2013, with a dozen or so new office buildings. However, he noted that “while a large proportion of the space currently under construction has been precommitted, proposed construction from 2012 onwards has yet to receive sufficient tenant interest.


“The reality for a number of landlords is that their premises will face a rising vacancy rate over the short term and, if they’re unprepared, that may be extended into the medium term.”


Want to comment? Go to the forum.


Attribution: JLL release, story written by Bob Dey for the Bob Dey Property Report.

Continue Reading

SEB buys 6 properties in month

Published 6 January 2010

SEB Asset Management AG acquired a new retail centre with a hotel in Germany and an Austrian property this week, on top of purchases in England, Japan, the Netherlands & Germany in December. The total for the 6 purchases is about €300 million (the price of one hasn’t been disclosed).


The German asset management business of Stockholm-based SEB (Skandinaviska Enskilda Banken) has been operating for 30 years, and the Birmingham purchase took the portfolio of its ImmoInvest fund to 150 properties worth €6.2 billion worldwide.


In December, SEB Asset Management added 2 development projects – the Werfthaus, which was built directly on the banks of the river Main in Frankfurt, and the Maastoren office tower in Rotterdam – to the assets of the ImmoInvest fund, on completion.


The Werfthaus in Frankfurt’s Westhafen, has 14,000m² net lettable area on 11 storeys, 60% leased to an insurance group for 10 years, 25% on a 5-year lease & 15% covered by a 5-year rental guarantee provided by the two sellers – Groß & Partner Grundstücksentwicklungsgesellschaft mbH & OFB Projektentwicklung GmbH. The total investment costs were €69.5 million.


The 165m Maastoren in the new Kop van Zuid office location in Rotterdam is the Netherlands’ tallest office building. It has 38,000m² total rental space over 44 storeys and is fully let. The 4 largest tenants are on 10-year leases. The total investment costs were €162 million.


A week later, SEB acquired the fully leased AEON Chiba New Town Shopping Centre in the Japanese city of Chiba, in the Tokyo vicinity, for its SEB Asian Property Fund SICAV-FIS for the equivalent of €91 million. The centre was completed in 2007 and is fully let to the operator, AEON, until 2027. It has 130 shops, a cinema and fitness & leisure facilities. The centre is the sixth purchase for the special fund, which is governed by Luxembourg law and is 100% invested in Asia. In addition to Tokyo, the fund has investments in Shanghai & Singapore.


On 23 December, SEB Asset Management said it was exploiting the favourable situation in the British real estate market for the re-entry of its open-ended real estate fund SEB ImmoInvest. It bought a class A office building in Birmingham, leased until April 2022 to the Royal Bank of Scotland.

The seller is The Equitable Life Assurance Society, which was represented by Invista Real Estate Investment Management Plc, the UK’s largest listed real estate corporation. The total investment costs were the equivalent of €35.1 million.


The property at 2 St Philips Place was completed in 2002. It has 5890m² on 7 floors, plus basement storage & parking.


On 4 January, SEB acquired the first property in Austria for its SEB Europe REI real estate special fund. The 33,700m² distribution centre, in Enns, is leased to C&A Mode Gesellschaft mbH & Co until the end of 2020. The vendor, REDEVCO Central Europe, wants to focus on retail real estate. The sale price wasn’t disclosed. SEB Europe REI is a German real estate special fund aimed at institutional investors.


SEB’s latest purchase is a newly built & fully leased retail centre with hotel in the city centre of Münster, Germany. The overall investment costs were €68 million. Developed & sold by the Dortmund-based Harpen Immobilien Gesellschaft, the Stubengasse Münster was completed in 2009. It’s directly connected to the main railway station and consists of 2 4-storey buildings which combine a mix of a 140-room hotel (run by the Ramada Treff hotel group) & 16,800m² of retail, plus 318 basement parking spaces. The property has been acquired for the open-ended SEB ImmoPortfolio Target Return Fund.


Want to comment? Go to the forum.


Attribution: Company releases, story written by Bob Dey for the Bob Dey Property Report.

Continue Reading

German fund enters Portuguese market

Published 5 January 2010

Hamburg-based Union Investment Real Estate GmbH has entered the Portuguese market, buying the first of the Colombo Towers project in Madrid’s 2 office blocks for an open-ended fund it manages.


Union Investment has bought the fully leased Torre Oriente for about €70 million from the project consortium, a partnership between Caixa Geral de Depósitos Group, Iberdrola Inmobiliária, ING Real Estate and Sonae Sierra.


Including the Colombo Shopping Centre & parking lot, the project covers 500,000m². Work has begun the second office building, the Torre Ocidente, and it’s scheduled for completion in 2011.


Union buys Pirelli project in Hamburg


Union Investment followed up that December purchase with an announcement on 4 January that it had bought the Geschäftshaus Ottensen in Hamburg for its Unilmmo:Deutschland fund for €60.05 million. Vendors were Pirelli & C Real Estate SpA, of Milan, and B&L Real Estate GmbH, of Hamburg. Union Investment had already bought the adjoining Mercado shopping centre & adjacent business premises 6 months ago. Pirelli will continue to manage the properties.


Pirelli RE completed the property on Ottenser Hauptstrasse in 2008. The building has 8250m² of retail, 2500m² office & 83 parking spaces.


Union Investment has €18 billion of assets under management in 6 real estate funds and in 26 countries.


Pirelli RE is an asset & fund management company that acquires high quality portfolios and manages them to increase their value through minority stakes in joint ventures with leading international investors. It has €15.1 billion of real estate under management, half in Italy, half in Germany and a development project in Poland.


Want to comment? Go to the forum.


Attribution: Company release, story written by Bob Dey for the Bob Dey Property Report.

Continue Reading

CBRE survey shows Wellington office market tightening

Published 12 August 2008

CBRE researchers say the cbd office stock in Wellington fell by 1400m² (0.1%) to 1.27 million m² in the first half of the year, despite the addition of 7236m² in the new Chews Lane building occupied by LTNZ (now part of the NZ Transport Agency with Transit NZ).


CBRE office services director Matt Hince said: "The figures confirm that we are experiencing an extremely tight leasing market. Tenants are starved of choice for the medium term and many landlords are making the most of their time in the sun by maximising the advantages provided by these conditions.


"Considerable new stock is programmed for completion from late next year onward, which will redress the balance of power in the landlord/tenant relationship.


"It is heartening to see the prudent approach taken by owners of poorer quality stock in terms of undertaking refurbishment, as it is this sector of the market that will come under serious pressure once the new constructions are completed."


CBRE’s 6-monthly office occupancy survey reviews changes to stock, vacancy & absorption in the 3 central Wellington precincts – the core cbd, Thorndon & Te Aro.


Mr Hince said new office space created by completion of the LTNZ building and the reconfiguration of some existing buildings had been offset by the withdrawal of other office stock for refurbishment. The LTNZ building, at 50 Victoria St, is an A-grade, 6-storey building and has been fully occupied by LTNZ since February.


Additional new office space was also created through the reconfiguration of some existing buildings. For example, in the Majestic Centre, 377m² was created to accommodate the expansion of an existing tenant, Opus, on its second podium floor and the apartment on the top floor of Featherston House was converted into an office (378m²) for Robert Walters International Ltd.


Since the end of 2007, the Wellington Central Library has also made available 1100m² on level 4, which was leased by the Wellington City Council.


Offsetting new supply, 2 buildings have been temporarily withdrawn for refurbishing. Feltex House (2640m²) in the Te Aro precinct has been undergoing renovations since the beginning of 2008 and it will return to the market in September. The upgrade of Aorangi House. in Thorndon, is due for completion by mid-2009. It has a net lettable area of 4743m², of which 80% have been pre-committed to by a non-Government tenant.


Want to comment? Email [email protected].


Attribution: CBRE release, story written by Bob Dey for The Bob Dey Property Report.

Continue Reading

$NZ11,800/m² sale price for Washington building

Published 17 April 2008

A Washington office building has been sold by a German fund to an Irish one for a record $US867/ft² ($NZ11,797/m²).


Jones Lang LaSalle said yesterday it had sold 2099 Pennsylvania Avenue on behalf of German fund Wealth Management Capital Holding GmbH to Vico Capital of Ireland for $US172.5 million.


The price eclipses the former record by more than $US40/ft² ($NZ544/m²). The trophy 199,000ft² (18,487m²) class A office building is just blocks from the White House in the heart of Washington’s cbd.


Want to comment? Email [email protected].


Attribution: JLL release, story written by Bob Dey for this website.

Continue Reading

West End stays most expensive, Auckland up in DTZ world survey

Published 14 January 2008

International property advisor DTZ said results from its annual global office occupancy costs survey, out last week, pointed towards strong occupier demand across all key global regions despite fallout from the US sub-prime crisis.


London’s West End continued its hold as the most expensive location globally, with Hong Kong second and London City third. Singapore skyrocketed up the world rankings, from 55th place to 13th in the past year, highlighting the sustained strong demand for prime office space in the Asia Pacific region.


Auckland was New Zealand’s most expensive city in 68th place, jumping 5 places from last year with a total office occupancy cost of $NZ9755/workstation/year.  Wellington jumped 9 places to rank 91st, with an occupancy cost of $NZ7632/workstation/year, and Christchurch dropped 4 places to 122 with an occupancy cost of $NZ5276/workstation/year.


DTZ NZ’s national research director, Ian Mitchell, said Auckland’s position in the survey ranking placed it ahead of other large cities such as Los Angeles, Montreal & Canberra.


He said it indicated that, while the office market enjoyed a buoyant year in 2007, the shortage of space, particularly in Auckland, would force employers to use space more intensively or seek lower-cost alternatives outside the cbd.


Sydney was the seventh most expensive city in the Asia Pacific region and the highest-ranked Australian location at 44 on the global list. Brisbane was placed at 50, dropping 10 places from 2007, and Melbourne remained steady on 98.


The office occupancy survey also paints a reasonable outlook for the year ahead. Mr Mitchell said the survey outlined the expectation that occupier market fundamentals would remain healthy, although some probability of weakening demand remained if the economy slows and affects jobs growth in core sectors.


Globally, 77% of the 137 locations surveyed expect occupancy costs to increase in 2008 while a further 22% of the locations expect occupancy costs to stabilise, reflecting the generally positive economic prospect.


The 10 most expensive office locations by occupancy costs in the DTZ survey are:


London (West End), $NZ38,233 ($US31,160), 34% year-on-year increaseHong Kong, $NZ33,791 ($US27,540), 27%London (City), $NZ25,387 ($US20,690), 17%Paris, $NZ25,067 ($US20,430), 15%Tokyo (central 5 wards), $NZ22,614 ($US18,430), 15.5%Dublin, $NZ22,245 ($US18,130), 14.7%New York (Midtown), $NZ20,871 ($US17,010), 3.7%Palo Alto, California, $NZ20,699 ($US16,870), 50%Frankfurt, $NZ20,652 ($US16,830), 25.5%Oslo, $NZ20,540 ($US16,740), 56.7%. 

NZ comparisons:


Auckland, 68, $NZ9755 ($US7950), 30.5%Wellington, 91, $NZ7632 ($US6220), 27.5%Christchurch, 122, $NZ5276 ($US4300), 20.4%. 

Occupancy costs are defined as the average total cost of leasing prime net usable space. This is defined as modern, well specified office space of 10,000ft² (929m²) within a prime central business district location. They include rent & outgoings, such as maintenance costs & property tax, if these are normally payable by the occupier, but exclude rent-free periods, fitting-out costs & other leasing incentives.


Want to comment? Click on The new BD Central Forum or email [email protected].


Attribution: DTZ release, story written by Bob Dey for this website.

Continue Reading