Press House, Christchurch
The Press Precinct in central Christchurch, which includes the site of the newspaper’s former Cathedral Square offices, has been sold to a group of local investors.
The off-market sale incorporates five properties, spanning 146-160 Gloucester St and 32 Cathedral Sq. The cache comprises four sites and the seven-level Press House, fully leased to Fairfax Media Limited, to which the publisher returned in May this year.
It is the second substantial Christchurch CBD building transaction in the past six weeks, following the recent sale of HSBC Tower in Worcester St to another local investor. Hamish Doig, managing director of Colliers International brokerage in Christchurch, handled both deals.
“Collectively, these two transactions to local buyers total more than $50 million in just a month and a half. Press House had a passing yield of 7.5 per cent. I think they send a real signal to the Christchurch market – and investors both nationally and offshore – that there is immense confidence in the city’s future and in the blueprint to deliver what it has set out to do – a vital and thriving central city.
“Our experience is that the blueprint has given tenants the confidence to return to the central city as soon as they are able and investors are certainly positioning themselves to capitalise on the excellent opportunities that are becoming available. By framing the CBD, the blueprint has created real pressure on sites – both from a tenant and investor perspective.”
For instance, Doig said the Press Precinct sale highlighted investor confidence in the development of Cathedral Square, and the Convention Centre plans.
“The precinct properties are absolutely ideally placed to benefit from the blueprint plans because of their strategic positioning and could potentially house the likes of apartments, offices and a hotel.”
He said the buyers, who wished to remain anonymous, were experienced investors.
“The nature of the blueprint has necessitated that they change their original plans but they’re still keen to pursue opportunities for development to attain the equivalent square metres they previously held.”
Both Press House and HSBC Tower are fully leased to long-term tenants.
Michael Doig, Ganellen’s director in Christchurch, was delighted with the Press Precinct sale as it “represents local capital being reinvested locally.
“In 2008 when Ganellen acquired the Press site it provided a long term pipeline of construction work around which we could build our business in Christchurch. It was the best way for us to demonstrate our construction capability to local clients working hand in hand with local people and contractors.
“The opportunities associated with the re-building of Christchurch have meant that a significantly greater pipeline of construction projects has developed. We have evolved our strategy to meet the new market conditions in Christchurch. This transaction will allow us to focus on our core business of construction whilst providing additional working capital to facilitate the forecast growth,” he said.
“There is a strategic fit between the purchasers and our business. They have a significant portfolio of properties in the CBD including the Press Precinct and they wanted a strong construction delivery partner, a partner they could rely on to work with them over the coming years. We provide this surety in what is going to become a very busy market place. Certainly our successful delivery of a fully integrated and operational facility for Fairfax New Zealand during challenging times, we believe, was integral in their decision making process.”
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