The head of the country's largest office investor says he is not concerned that one of his biggest tenants is leaving a prime Auckland waterfront office block.
Rob Lang, executive manager of the listed AMP Office Trust, said Westpac's departure from the PricewaterhouseCoopers tower would mean other tenants could expand
into those areas. "We now have a shop with something on the shelf to sell."
He was disappointed at Westpac's move because the bank was the single largest tenant by rent roll. But the tower was almost fully occupied, so the tenant's departure provided opportunities for other lessees. "That's the silver lining in the cloud," Lang said.
Westpac announced this week that from 2009 it would shift staff from the tower, and from offices in Wellington, Royal Oak and Hamilton, to three Britomart buildings - two new blocks and the historic Charter House. The bank aims to complete the move by 2011.
Westpac rents levels nine to 15 and level 29 in the PricewaterhouseCoopers tower. It's lease expires in 2011.
AMP Office Trust 's latest annual report showed it gets about $95 million rent annually, of which Westpac contributed about $4.8 million.
Lang said no other tenants had plans to leave the tower because most of the leases were only three to four years old and were on six, nine and 12-year terms.
Westpac head Ann Sherry said the Britomart move would allow the bank to centralise staff on one site. Westpac would have naming rights over the new offices, which will be built in a $100 million deal.
Lang said most banks had naming rights on their Auckland towers. BNZ is spending $125 million redeveloping its Queen St site, ANZ has naming rights on the Albert St tower it rents from the trust, and ASB has naming rights on block further up Albert St.
AMP Office Trust's share closed up 1c yesterday at $1.15.
