2 new apartment projects in downtown Auckland are leading the market to new price points as high as $16,000/m².
Despite the high prices & strong international competition, sale agreements were signed in Shanghai last month on 10 apartments in the Victoria Residences development across from the SkyCity casino.
Local marketing began onsite last week for Victoria Residences, a Conrad Properties Ltd project on the 522m² site at 75 Victoria St which the company bought for $7 million late last year from the Chow brothers, who’d intended to develop a highrise brothel there.
By the end of last week, sales were under negotiation on 25 of the 161 apartments and 5 of the 9 ground-floor retail units in the 25-storey tower.
Opening apartment prices ranged from $385,000 for a 33m² “Sky pad” studio, at just under $11,700/m², to $16,200/m² for a pad on the top floor. Top of the range is a 74m² penthouse for a little over $1.1 million, at $15,200/m².
A number of the units have dual keys – they can be occupied as a single unit or split in 2, plainly with the investment market in mind. But Bayleys residential project marketing specialist Peter Turner said the building had been designed to a higher occupier specification with a low return of about 4% gross: “These are owner-occupier versus capital-gain investments.”
Mr Turner said agents were working in 2 markets, international & domestic, but valuers were assessing apartments only in domestic terms. In a local comparison, these prices had moved beyond better quality units in the secondary market, such as a 30m² Statesman studio sold recently for $8300/m² versus $16,000 for the top Sky pad.
The main range in Victoria Residences was around $13-14,000/m², up about $3000/m² on the initial range in the St James apartments, above the St James Theatre on Queen St.
The St James Suites will have 307 apartments in a 39-storey block, to be developed by the Li family. The project was announced at the beginning of November and is more than half sold – 93 sold, 81 under contract.
Mr Turner said these projects were competing in an international market “against Portugal, Greece, America, but we’ve had so little product up in China or the Middle East in the last few years, we don’t have a presence”.
He was in Shanghai for the annual Luxury Properties Show Case exhibition early in December, where 2000 developers from around the world were exhibiting to an invitation-only audience of 5000 potential buyers.
“Our prices were dearer, but New Zealand is a good immigrant location. We are a lifestyle location, but we are not a really good investment location, the market is too small.”
Attribution: Promotion documents.