Auckland Light Rail agrees to buy Kingsland’s Kiwi Bacon Building for $33m

The building at 317 New North Rd, Kingsland. Photo / Whillans

In one of the clearest displays of optimism, Auckland Light Rail has contracted to buy the prominent Kiwi Bacon Building for $33 million, even though National has promised to scrap plans if elected next month.

Bruce Whillans of Whillans Realty Group said Jeremy Sim of his agency had an unconditional deal to sell the building on a half-hectare site at 317 New North Rd.

National plans to scupper the $14.6 billion rail project and spend a similar figure on seven highway and public transport projects if it’s elected, it has said.

The party has a $13.5b package for the Super City, including extending State Highway 1 from Warkworth to Wellsford and building rapid transit from Botany to the airport.

Whillans said the building is 95 per cent leased to a range of tenants and has a large car park for 108 vehicles. A deposit was paid yesterday and the purchase is due to settle in the next few weeks, he said.

The building returns $2.07m net annually.

An artist's impression of a segment of the Auckland light rail plan. Photo / Supplied

The vendor is understood to be private investors the Kermani Group which has extensive property holdings.

A spokeswoman at Auckland Light Rail confirmed the offer had been accepted.

Another real estate agency connected to the vendor is understood to have announced the sale already, which was one of the prompts for Whillans to reveal the deal.

Auckland Light Rail is a scheme planned to run from the Wynyard Quarter to Auckland Airport, via Kingsland, Mt Roskill, Onehunga and Māngere.

The Government has already spent $50m with about 200 different firms, including five big law firms and competing consultancies like PwC, EY and KPMG on Auckland’s light rail system, the Herald has reported earlier this year.

ALR chief executive Tommy Parker confirmed the purchase contract.

Parker said today: “As with all major infrastructure projects, property will be required for a number of purposes including the stations and surrounding infrastructure, as well as during construction”.

The Kiwi Bacon site at 317 New North Rd sits on the edge of Dominion Rd junction area and will be very close to the new station. The Kiwi Bacon site was offered for sale by tender. ALR Ltd made a tender offer which was accepted by the vendors.

As part of planning the route and station locations for the City Centre to Māngere corridor, an early property programme has been approved by the light rail board and project sponsors to allow the purchase of strategic properties, if and when they come to market and ahead of a formal property acquisition programme through the Public Works Act.

“Purchasing the property now reduces future claims for loss of business, as a result of construction impacts and disruption,” Parker said today.

That does not mean the public transport entity plans to demolish the building although Parker did not talk about that.

Anne Gibson has been the Herald’s property editor for 23 years, has won many awards, written books and covered property extensively here and overseas.