Big Auckland CBD land holding sells for $43.5M

13 Jan, 2009, Asia Pacific

Cushmam&Wakefield’s New Zealand affiliate Bayleys Real Estate Ltd has sold one of the Auckland CBD’s largest remaining underdeveloped commercial land holdings for NZ $43,500,000 (approx US$25 million) - the highest price ever achieved for a sale of a single property at auction in New Zealand.

The mortgagee sale on behalf of the first mortgagee Westpac Bank of the freehold ground lease interest in the 2.9139 hectare (7.2 acre) site fronting four central city streets attracted a huge turnout, with more than 300 people attending the auction in Bayleys’ central Auckland auction room.

Bayleys executive director David Bayleys, who sold the property with senior commercial broker Robert Platt, says bidding opened at $25 million and progressed in $1 million and $500,000 dollar lots to $40 million. Further negotiations then took place and the property came back on the market at $43,500,000 and sold under the hammer.

David Bayley, says it is Bayleys’ biggest auction sale in its 35-year history

“Despite the challenges the property market is currently facing, we had widespread interest in the site, and most of New Zealand’s largest property players were at the auction. We see a sale of this scale as a big vote of confidence in the long-term future of Auckland’s CBD.”

The Cook Street land holding auction in mid December was the third substantial Auckland CBD sale concluded by Bayleys in 2008. Earlier in the year, the agency sold a 3330 square metre (35,800 sq ft) prime corner site on Queen Street (Auckland CBD’s main street) and a 20-level office building in nearby Albert Street. These two buildings sold at a combined value of close to NZ$70 million (approx US $40m).

In December, Bayleys also concluded the largest commercial and industrial transaction in New Zealand’s capital city of Wellington for 2008. In what had been a subdued year for higher value property, Sovereign House in the CBD sold for NZ $19.6 million (approx US$11.3 million). The fully leased 14-level office building sold at a yield of 7.9%.

Bayleys has also recently sold a substantial industrial complex leased to one of Australasia’s largest media companies, APN, in Great South Road, Manukau for NZ$15.6 million (approx US$9 million) to a syndication company.

“As has been the case in most global property markets, it has been a tough year in the New Zealand market and high value sales in particular have slowed,” says Mr Bayley. “But for us it’s been nowhere near the gloomy scenario that’s been painted by some property industry observers.”

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