Overseas giant cleared to buy waterfront property

Singapore's Government Investment Corporation has bought a 49 per cent stake in Auckland's Viaduct Quarter.

Listed property business Goodman Property Trust has just announced it has Overseas Investment Office clearance to sell a 49 per cent share in some of Auckland's most
valuable commercial properties to Asian interests.

The deal involves assets valued at $313 million.

John Dakin, Goodman chief executive, said the OIO had given approval for the introduction of GIC as a new capital partner in an expanded joint venture in the Viaduct Quarter.

That quarter is Air New Zealand House, the new Fonterra development now being built by Fletcher Construction and the Viaduct Corporate Centre, containing the Vodafone, KMPG and Microsoft/HP buildings.

The Viaduct sale was announced in November but criticised by Winston Peters who questioned the sale to foreigners, as well as by institutional investors who questioned the value for the trust's investors.

Dakin said the joint venture is now unconditional and settlement is expected next month.

"The Viaduct Quarter is a proven investment location that presents exciting new opportunities with local government initiatives and private development transforming the former marine and industrial areas into a world-class, mixed-use waterfront precinct. The introduction of a strongly aligned capital partner will enable Goodman to extend and diversify its Viaduct portfolio maintaining a long term investment of around $250 million," Dakin said.

The joint venture, which includes GMT's existing Viaduct property interests, will own a portfolio of assets valued at $313 million with a mandate to grow to around $500 million over time.

Shane Solly, Auckland-based director, portfolio manager and research analyst with institutional investor Harbour Asset Management, and Matt Goodson, Salt Funds Management managing director, raised issues about the value of the Viaduct deal for investors in the NZX-listed trust.