Details of a $180 million building job on Auckland's waterfront to create a new InterContinental Hotel have been released today, with a major contractor appointed and due to start next month.
Scott Pritchard, Precinct chief executive of NZX listed landlord Precinct Properties, said the business had been working for months to prepare its 20-level Quay St building at One Queen St, previously called HSBC Tower, for major works.
Fourteen months ago, Precinct put the job on hold but today Pritchard said the market had changed and was more than ready for the new hotel and refurbished offices.
On Friday night, Precinct signed a contract with LT McGuinness to upgrade the building and they will erect a crane on the top of the block opposite the Ferry Terminal soon, Pritchard said.
A $305m tag has been attached to the job: existing building value with the total cost of works to upgrade it.
No extra levels will be added to the 14,000sq m block.
Precinct has also stolen big law firm, Bell Gully, from rival landlord Kiwi Property Group: the lawyers signed a lease for 4400sq m, planning to move from upper levels in the Vero Centre on Shortland St to the seaside block.
"We're really confident about the leasing market and the hotel market. The level of inquiry we've had on that building is really high. We've monitored both to see how things change and we've reduced the size of the planned hotel but we still really like the idea of a hotel use within Commercial Bay," Pritchard said today.
The new 139-room InterContinental hotel will be on levels six to 11. Offices will be from levels 12 to 20 and a new outdoor rooftop bar will be on level 21.
"We are absolutely thrilled to announce the construction commencement of this flagship project. Following the difficult decision around a year ago to defer the project due to Covid-19, resolving the best approach to the redevelopment of One Queen Street in a changed market has remained a key focus for our business," Pritchard said.
Abhijay Sandilya, IHG vice president of development for Japan, Australasia and the Pacific, said the new hotel would be in one of the best locations.
"InterContinental Auckland will stand at the foot of Queen St and enjoy unimpeded views of the Waitemata," he said.
The block was built in 1972 and refurbished in 1998.
Work is planned to be completed by 2023.
Precinct also wants to buy Auckland Council's Downtown Carpark but Pritchard said today nothing had been finalised.
Precinct had made its interests in the building known, he said.
"We don't have any agreements with them at the moment. Panuku will run the process on behalf of Auckland Council," he said.
On Saturday, the Herald reported that the Auckland waterfront could get a new skyscraper to rival the $1 billion Commercial Bay office tower and shopping centre at the bottom of Queen St.
Precinct is itching to buy Auckland Council's downtown carpark building and put up another striking tower near the city's skyline.
"It's a great site," said Pritchard, who envisages another tower with offices, a hotel and apartments.
The council is expected to go to the market in July to find a partner for what is the last big development site on the waterfront between downtown and the Viaduct Harbour.
The Downtown carpark is a seven-storey building with 1900 spaces, and sits on .65ha on the corner of Customs St West and Lower Hobson St, behind the M Social Hotel on Quay St.
Under the Unitary Plan, a 180m tall skyscraper - the same height as the 41-storey PWC Tower at Commercial Bay - can be built on the site.
Pritchard said Precinct had to win a competitive tender first, but if it is successful a new building would be part of an east-west urban environment from Britomart to Commercial Bay, the Viaduct Harbour and Wynyard Quarter.
"Commercial Bay is a $1b project and this would be bigger," said Pritchard, who said the company had clear ideas about what it would do with the site, but could not share them at this stage.
If Precinct won the tender, he said, the company would get cracking straight away on a six-to-eight-year build.