Auckland's Queen Elizabeth approved for sale

The site will be part of Precinct's planned $681 million Commercial Bay development in downtown Auckland.

Auckland Council has approved the rezoning of the city's Queen Elizabeth Square, pushing forward its sale to Precinct Property Group.

The Auckland-based property investor said the council publicly notified the approval of rezoning by the independent commissioners appointed to consider the request. Precinct agreed to a $27.2 million conditional purchase of the 1900-square-metre site in February last year, as part of a deal with the council to enable the construction of the City Rail Link.

Barring an appeal, the agreement will go unconditional, it said. The site is adjacent to Precinct's Zurich House, HSBC House and the Downtown Shopping Centre.

As part of the deal Auckland Transport will pay Precinct $9 million compensation for loss of its land due to the construction of rail tunnels, and a further $10.7 million reflecting the additional costs of constructing its planned office tower due to the CRL tunnels.

The site will be part of Precinct's planned $681 million Commercial Bay development in downtown Auckland.

The development will encompass Precinct's four buildings in the surrounding area - PwC Tower, AMP Centre, HSBC House and Zurich House - and will be worth about $1.5 billion on completion, representing 63 percent of the property investor's portfolio, it said in a statement in December.

Fletcher Building has been hired for the Commercial Bay development, with work expected to start in June this year, including construction of tunnels under the precinct for the city's rail link.

The retail centre is expected to open by October 2018, with the office tower completed by mid-2019. The company's Auckland Wynyard and Commercial Bay developments will increase its gearing to about 35 percent from 12.5 percent at present.

Precinct shares rose 0.8 percent to $1.225, and have fallen 2 percent so far this year.