AMP NZ Office buys Auckland's Downtown Shopping Centre
Stock Exchange-listed AMP NZ Office is buying the Westfield Downtown Shopping Centre on Auckland’s waterfront for $90 million.
The midday Stock Exchange announcement says the acquisition will increase annualised earnings by 3%, providing for an increased dividend of 5.12cps for the 2013 financial year, a slight increase on the 2012 dividend of 1.6%.
Chief executive Scott Pritchard describes the purchase as “one of New Zealand’s best long term investment opportunities”. It has further development potential.
The site adjoins the company’s PwC Tower, Zurich House and AMP Centre and provides potential to create accessways and linkages.
Mr Pritchard says he also supports Auckland Council’s call for a masterplan for the precinct.
AMP NZ Office is changing its name to Precinct Properties New Zealand, reflecting its evolution over 15 years to become a specialist listed owner of premium central city office space.
Opened in 1975, the Downtown Shopping Centre has a land area of about 6500sq m and resource consent for a 71,000sq m mixed-use office and retail development.
It was refurbished in 2005 and is fully leased to around 80 retailers over four levels with a total of 14,368sq m of net lettable space.
The purchase price is below independent valuation and reflects an initial yield of 7.6%.
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Comments and questions15
Glad to see the Downtown shopping centre sold, It didn't fit well in westfield's portfolio because of how small it is.
Why do people continue to think ANZO and now Precinct Properties is AMP - the only connection is a partial shareholding of the mngt company. Pritchard is highly regarded and has built up a very good team around him, this is good for Auckland.
I bet it would have been worth much more than $90 million if the escalators were working...
Or the shops were open after working hours for all their customers!
Exactly the escalators havn't been working for months and the place is so tired.
Hopefully AMP can do as good a job as they have with Zurich House - they are great landlords
Agreed - its a good fit for AMP - they need somewhere to store the tumbleweed for the Zurich house building....
Westfield only sell crap.
As Bob Jones said "do the opposite of what AMP does and you'll make money"
AMP certainly have made some big mistakes in the past, under past poor governance. Rob Laing was in there somewhere.
Westfields modus operadi has been always been driven by short term profit, at the expense of everyone in between. Its a culture greed, flowing from the top. The Lowys didnt get super wealthy (relatively quickly) without taking some prisons along the way. You can bet this will be a full price; and they probably sold the rights to the underground for rail on the way through.
This deal may still work for AMP, through the synergies it creates with its adjoining real estate. A mall extension may just be on the cards. They may have to hold for an extended period of time to recover their money, but thats property anyway.
Wonder if they've sorted out a deal with the council before buying it as the council will flatten it for the Central Rail Link tunnel
Wonder what happens when the inner city rail loop runs through its foundations?
I would have thought this was bought as a redevelopment site. Put a 30 level tower on it (with some carparks) and it will be worth 4x as much.
BIggest thing hanging over its head is what will happen if the rail tunnel ever goes through but they could incorporate that into the build.
What does "uncle Bob" think?
Didn't he once say "buy when AMP are selling" - maybe the reverse is true?
A quick look at ANZO's property book shows they have no shopping malls, and only have office towers. After all - they are an OFFICE company, their name says it all.
Five will get you ten that the downtown shopping centre is earmarked for demolition, followed by a tower to match the PWC tower they own across the road.
It has huge potential as a curry mega center.