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The week in real estate development - 22 July 2021

The week in real estate development  22 July 2021

A weekly update of the biggest real estate development news from New Zealand and around the globe.

New Zealand real estate development news

  • Chris Farhi Vlog goes behind the scenes at Pro-invest Group's Voco-HIE hotel development: This vlog went behind the scenes of the construction of the $200M Voco-HIE hotel at the corner of Albert Street and Wyndham Street in central Auckland. The development is a 41 level, 495 room hotel featuring dual brands (Voco and Holiday Inn Express). The project had just passed 80% completion at the time of the tour. Some of the interesting aspects of the tour were the use of pre-fabricated Interpod bathrooms, the use of mock-up rooms to optimise design and delivery, and the impact of the dual brands. Big thanks to Pro-invest Group (developer / investor) and Icon Co (lead contractor) for giving us the opportunity to have a look.
  • Kiwi Property awaits final interest deductibility terms before commencing development: Kiwi Property is awaiting the final interest deductibility terms relating to new builds before proceeding with a 300-unit build-to-rent development at Sylvia Park. Kiwi Property is also seeking consent for another similar development at LynnMall.
  • Auckland Council rejects Carlile House offer: Auckland Council has rejected an offer that it be gifted Carlile House for free so it can be restored. The 134-year-old heritage building has experienced various issues over the last 40 years including warped roof railings, exposed roof cavities and crumbling tiles.
  • Silky Otter Cinemas to open in new Ponsonby development: Silky Otter Cinemas will take up a large part of the ground floor of the new Ponsonby Central development. The cinema will include four luxury boutique cinemas with access to premium food and beverages, and availability for event hire. The cinema plans to open upon the completion of the new stage of Ponsonby Central in early 2022.
  • Indigo Hotel begins construction: Construction has begun on the new $250M Indigo Hotel in central Auckland. The 41-level tower will include 30 levels of hotel space and 30 apartments. The front and rear facades of the historic Macdonald Halligan Motors building will remain.
  • Hamilton City Council implements financial incentive to developers: Hamilton City Council is giving developers financial incentives to build higher buildings in the CBD. Buildings in the CBD that are six storeys and above will attract 100% remission on development contribution fees, but if the building is below six storeys there will be a 50% remission. The new policy will work towards addressing Hamilton’s housing shortage.
  • 3MS subdivision application denied: An application by 3MS for a 161-hectare residential subdivision development in Cambridge has been denied. The application included 246 residential sections, commercial centre, retirement village, a school, roads, and reserves. The application was denied because it differed from a structure plan that sets out development guidelines in the area.
  • The Palmerston North Māori Reserve Trust’s retail development begins: The Palmerston North Māori Reserve Trust’s 3,250 sqm retail development in Palmerston North has begun. The retail development is filling a vacant lot between Breakers and the Farmers home store. The retail spaces will be occupied by Bargain Chemist, Look Sharp and VRC Computers upon completion next year.
  • Wellington City Council appeals for order to strengthen heritage buildings: Wellington City Council has appealed for orders to strengthen the Adelaide Hotel and the Toomath’s building to a minimum standard of 34% after the owners failed to meet deadlines to do so. In Wellington there are more than 500 earthquake prone commercial and unit title buildings.
  • Government announces first investment from Housing Acceleration Fund: The government has announced its first investment from the $3.8B Housing Acceleration Fund will facilitate 2,000 additional houses in Porirua. The $136M investment will focus on land remediation and upgrades to water infrastructure which are needed for further housing development. The project will create 250 jobs.
  • Wellbeing focused co-housing development plans announced: Jane Quigley has announced plans for a wellbeing focused co-housing development called ‘Whitmore co-housing village’ in Christchurch. The 3,000 sqm site will have 18-22 energy efficient attached homes, a garden, play area, a community house for shared meals and shared facilities such as a laundry to facilitate social connections. The homes are terraced houses and apartments. Owners will take ownership of the home and joint ownership of shared facilities and gardens.
  • Investment House restoration completed: Investment House in Dunedin has undergone an 18-month restoration. The second floor of the 120-year old building was converted into four apartments and the ground level was kept as office space. The restoration was delayed by 9 months due to Covid-19.
  • Waitaki event centre receives council funding: The Waitaki District Council will contribute $10M to the Waitaki event centre development. The $24M development will include 6 courts, meeting rooms, storage space, office space, spectator areas and 80 car parks. The Waitaki Event Centre Trust are planning for the centre to be completed at the beginning of the netball season in 2024.
  • Southland mega-landfill gains consent: AB Lime in Winton has gained consent to operate without any limit on the volume of waste it can take from all over the South Island for the next 25 years. The consent has come with various conditions including continuous monitoring of hydrogen sulphide gas.

Global real estate development news

  • Pikos Group launches clifftop developmentPikos Group has launched its $200M clifftop development called Skye by Pikos in Brisbane. The residential tower will comprise 68 high end apartments and include a 1,000 sqm floating sky deck on a 2,300 sqm site.
  • SPG Land and Gordon Corp announce triple tower plans: SPG Land and Gordon Corp announced plans for a $800M triple-tower development in Surfers Paradise, Gold Coast. The development will have 792 apartments across three towers ranging 38 to 42 storeys. Tower one will be aimed at young people, tower two will cater for families with a kid’s zone, and the third tower will be aimed at mature lifestyle buyers.
  • Construction to begin on metro tunnel: A joint venture between Acciona Construction Australia Pty Ltd and Ferrovial Construction Australia Pty Ltd has been awarded the $2B contract to construct the 11 km twin metro rail tunnels between Sydney Olympic Park and The Bays in Australia. The contract also includes the development of five new stations along the line.
  • Construction begins on Mernda Shopping Centre: Construction of the Mernda Shopping Centre, Melbourne has commenced as Occasio Projects announced the purchase of the $500M mixed-use development from Woolworths. Stage one of the development will have 35 speciality retail shops and Woolworths will remain the anchor tenant. Stage one will open in mid-2022, cost $110M and create 300 construction jobs.
  • VVS Investments plans work-from-home apartments: Developer VVS Investments has announced plans to develop work-from-home apartments in Asheville, USA. VVS Investments is aiming to gain a conditional rezoning for six 3-4 storey buildings comprising 286 one, two and three-bedroom apartments. The layout of the apartments will allow extra space for home offices due to the rise in working from home after COVID19. At least 29-43 units will be affordable at 80% of the area median income.
  • Construction begins on off-campus science and medical tower: A private developer has begun the construction of a 7-storey off-campus science and medical tower for UC San Diego. The $70M La Jolla Innovation Centre will be located near the university and will be 100 feet tall.
  • Groveworld gains planning approval for Kings Cross hospital redevelopment: Groveworld has gained planning approval to redevelop the Royal National Throat, Nose and Ear Hospital in London, into housing and offices. The plans include 72 flats, 14,000 sqm of office space and a 182-room hotel. Construction is expected to begin in early 2022. The facility closed in October 2019 after the hospital relocated to a new location.
  • Ellandi announces Merry Hill shopping centre revampOperator Ellandi has announced the £50M revamp of Merry Hill shopping centre near Birmingham, UK. The revamp will occur over five years and include a new family entertainment district, 22 new units comprising 21,367 sqm, and enhance sustainability credentials via solar panels and 200 electric vehicle charging points. The centre aims to be carbon neutral by 2030.
  • Plans announced to demolish Cardiff shopping centre: Plans have been announced to demolish the Queens Arcade shopping centre in Cardiff to make way for an open street with a hotel, retail, and commercial space. Queens Arcade was built in 1994 and is one of the largest shopping centres in Cardiff.
  • Art Data Centres planning new data centre in Ireland: Art Data Centres is planning six 2-storey data halls in Ireland, comprising 120,000 sqm with access to 200MW of power. The $1.4B proposal is supported by Clare County Council which rezoned the land for the project in 2019. The new data centres will create 250 jobs and 1,200 construction jobs. Construction is expected to begin late 2022.
  • Hilton to open 3 new hotels in Mexico: The Hilton has announced plans to open three new hotels in coastal locations in Mexico. Two hotels will be in Tulum, being the Hilton Tulum all-inclusive resort with 735 rooms and the Conrad Tulum with 349 rooms. The third hotel will be in Puerto Vallarta called the Hilton Vallarta Riviera with 444 rooms. The Tulum all-inclusive hotel will open in Q1 2022 whilst the other two will open in Q4 2021.

Related Experts

Chris Farhi

Director | Strategic Advisory

Auckland CBD

Chris is a Director within the Strategic Advisory team. The team helps you with your big property decisions and complex transactions.

Chris' advisory work focuses on:

  • Decision making processes (eg property strategy, business cases, feasibilities, etc)
  • Tenant representation for large lease transactions (office,  industrial and specialist-use)
  • Multi-site networks (eg consolidation strategies, optimisation, etc)

Chris’ background in brief:

  • Property strategy advisor for some of New Zealand’s most successful private sector, public sector and non-for-profit organisations.
  • Tenant representative (tenant-paid lease negotiator) for organisations ranging from small-to-medium enterprises through to major listed companies and government agencies.
  • Specialist skills in commercial leasing, financial analysis and market research.
  • Part-time lecturer at the University of Auckland Business School and commercial leasing trainer for the Royal Institution of Chartered Surveyors.

Chris’ qualifications include Honours degrees in both Civil Engineering and Property from the University of Auckland, and a Master of Philosophy from the University of Cambridge, UK. He is a Chartered Member of the Royal Institution of Chartered Surveyors.

Outside of work, Chris is a combat engineer in the NZ Army Reserve and a keen baker.

View expert

Renee Lintott

Analyst

Auckland CBD

Renee was the recipient of the Blair Hargrave/Colliers  Scholarship in 2019 before joining the  Strategic Advisory team as an analyst in the same year. Renee worked part time in the team for 2 years whilst completing  her tertiary qualifications and joined full time in mid 2021. 

View expert