Newmarket facelift on way as brewery site sells for $162m

One of New Zealand's largest real estate developments is being planned for the heart of Newmarket.

Australian insurance company AMP has bought Lion Nathan's 5ha brewery site on the corner of Khyber Pass and Park Rds for $162 million.

Its property investment division, AMP Capital Investors, is expected to apply to Auckland City for a plan change, allowing the land to be rezoned from industrial use so a mixed-use development can be built there.

Large offices, dozens of shops, hundreds of apartments and thousands of carparks and are expected to appear on the site in the next few years.

An AMP executive said last night a retirement village and a hub of bars and restaurants were also planned.

The land is in an area pinpointed in the Auckland Regional Council's growth strategy as being in a strategic managed growth area.

That means the site can be heavily built on, and the authorities are likely to encourage AMP to build high and wide to maximise its potential.

The property is near major transport nodes and the ARC has earmarked the general area as one that should be intensified with large-scale development, acting as a magnet for people.

Auckland City is also likely to look favourably on any rezoning applications because it has a policy of encouraging mixed-use developments in which people can live, work, shop and find recreational activities within easy reach. Kiwi Income Property Trust's $300 million Sylvia Park is a prime example of this type of development, although the offices and apartments have yet to be built.

AMP's new site is near the Newmarket railway station and close to the Broadway shopping precinct, giving workers, shoppers and apartment dwellers easy access to other parts of the city by public transport.

Lion New Zealand managing director Peter Kean was upbeat about the sale, saying it was time to move.

Newmarket had become a light commercial, retail and residential area and the site was landlocked, making access to the brewery and expansion difficult.

"The long-term benefits we can achieve by establishing a new facility elsewhere in Auckland are too positive to pass up."

A new brewery would enable Lion to better align its production and supply chain with the needs of the marketplace.

It would also improve its working environment and optimise productivity.

"We are deeply committed to maintaining an Auckland brewery presence and we recognise that as time passes and Auckland develops, the number of quality alternative Auckland sites is diminishing.

"In acting now, we are securing our manufacturing future in Auckland."

Mr Kean said Lion had other sites in mind but declined to say where until a decision was made - most likely in November.

AMP will pay $50 million at the end of the financial year and the rest when Lion leaves the site in about four years.

Lion's new facility will cost about $250 million, including the purchase of land, plant and equipment.

It said staying at the existing brewery would require an investment of about $50 million.

Newmarket Business Association head Cameron Brewer said AMP Capital Investors had a "great track record" with previous developments but Lion's exit "marks the end of Newmarket's industrial age".

He encouraged the two companies to leave the site's Captain Cook statue.

"We will miss the smell of hops from time to time in Newmarket.

"For over a century and a half the brewery has been part of Newmarket's identity," Mr Brewer said.

"We will encourage Lion Nathan and AMP to leave behind a reminder of Newmarket's colourful brewing past."

Lion Nathan corporate affairs director Liz Read said the company would discuss the fate of the Captain Cook statue, on the footpath outside the brewery, with the new owners.

- additional reporting: Alanah May Eriksen

What's in store

* Dozens of shops.
* Hundreds of apartments.
* Thousands more carparks.
* A new restaurant/bar district.
* A retirement village.


Trouble brews as neighbours and businesses consider redevelopment

Not everyone in Newmarket is thrilled about the prospect of such a large development taking place next door.

Some Broadway businesses worry that the development would pull people off Broadway and eclipse Westfield's 277 shopping centre, where it is planning multimillion-dollar expansion.

Many years of construction activity will not be entirely welcome, following hostility over L & Y Holdings building on land between Broadway and the railway line. Retailers see L & Y's large-scale apartment developments as being a boom for the area, bringing more residents and shoppers.

But disruption to business, noise and nuisance have caused an outcry in the area in the last few weeks.

Westfield (NZ), run by deputy director Justin Lynch, is expected to strongly oppose AMP's plans, fighting against the plan change which would allow development of the Lion site and threaten its 277.

Westfield is quitting shopping centres in Glenfield and Pakuranga, concentrating on areas where it sees big growth potential - and Newmarket is its prize asset.

The 277 shopping centre is set to grow to almost twice its present size and stretch all the way to Gillies Ave.

Crucial to those plans is Westfield's ability to secure a multiplex cinema operator.

Westfield also has big plans to develop the former Levene Extreme site across Mortimer Pass from the 277.

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