Auckland Transport is joining business giants Fonterra, Air New Zealand, KPMG, Microsoft and Hewlett Packard at the flash VXV Precinct on the Auckland waterfront.
The ratepayer-funded transport body has signed a heads of agreement to take a lease on the Vodafone Building in Fanshawe St, which is being upgraded to provide "exceptional space for corporate occupiers", according to a marketing brochure.
Auckland Transport chief financial officer Richard Morris said the location would give the council body a cost-effective solution for its accommodation requirements with expected savings of close to $1 million in the first year.
Auckland Transport's 1500 or so staff are currently spread across 19 buildings with multiple leases. About half of the staff are located in the former Waitakere City Council civic centre in Henderson, built at a cost of $39 million.
Mr Morris said the 12-year-old Vodafone Building was not expensive compared to a new building or other offices in and around the CBD.
He said Auckland Transport would be reducing overall space requirements by about 2500sq m, leading to extra savings in areas like cleaning, electricity, IT and maintenance. Other savings would be made from a productivity gain of more than 50,000 hours through staff not travelling between buildings.
The Vodafone building has 14,000sq m spread over six levels with efficient work spaces, he said.
This month, Labour MP and mayoral candidate Phil Goff said the onus was on Auckland Transport to demonstrate the need to move to the CBD and the cost benefits.
He said if one assessment of leasing the building for $5.6 million a year is correct it is an unnecessary extravagance being imposed on Auckland ratepayers. Mr Morris said the hard savings in the first year of $1 million "was good enough" in terms of explaining the cost benefits.
In 2014, Auckland Transport divulged it was paying $1.65 million at $513/sq m to lease three storeys of the HSBC Building at 1 Queen St.
Last year, Auckland Council told the Herald that Auckland Transport leased 10,898sq m of non-council space in the 2014-15 financial year at a cost of $3 million.
The lease agreement for the Vodafone building is subject to further detail being agreed and is expected to be completed by May 31.
The move to Fanshawe St will be completed by November next year.
Auckland Transport will keep a presence at three regional offices in the north, Manukau and Henderson.
On the move
• Auckland Transport moving most staff to the CBD
• Lease being taken on Vodafone building
• Savings of $1m a year forecast
• Cost benefit figures not produced at this stage