Precinct Properties strikes $382m, four-building deal with Singaporean investors

The Charles Fergusson Building, Wellington: one of the four buildings in the deal. Photo / Precinct Properties

NZX-listed landlord Precinct Properties NZ can go ahead with a deal to sell Singapore's Reco Pacific Private a half share in four properties valued at $382 million to free up capital.

Precinct intends to next month sell a half share of two Auckland and two Wellington office blocks to Reco Pacific Private but is retaining a 50 per cent interest in those buildings via a newly established entity.

Precinct Pacific Investment Limited Partnership - half the Kiwi landlord and half Reco Pacific Private - will jointly own Wellington's Charles Fergusson Building at 38 Bowen St, Mayfair House at 54 The Terrace in Wellington and 10 and 12 Madden St in Auckland's Wynyard Quarter near the waterfront.

Many civil servants work in the two Wellington buildings. All four were listed as being worth $382,505,302. But the decision also said the total consideration did not represent the amount received by Precinct for the asset sales.

Toitū Te Whenua Land Information New Zealand today released the decision where parties to the deal won approval.

On September 15, Precinct announced the OIO had approved it but not what the value of the assets was.

Scott Pritchard, Precinct chief executive, said then that the partnership's establishment represented a milestone. The company was committed to creating further longer-term value and anticipated the partnership to grow to be worth around $1b.

The settlement of the transaction is expected to be in October.

Reco is listed as being 75 per cent owned by Singaporeans and has previously been reported as being part of the Singaporean government. Precinct is reported as 69 per cent Kiwi and 15 per cent United Arab Emirates, the OIO decision says.

The deal went to the OIO under the pathways of significant business assets and national interest assessment. No sensitive land was involved. Deals involving assets for more than $100m must go before the OIO for approval.

This year, the Herald reported on last year's largest commercial real estate deal - a sale of a half share in the ANZ Centre sale.

"Precinct has entered into an agreement for the sale of its 50 per cent interest in the ANZ Centre in Auckland for $177 million. The sale price is consistent with the June 30, 2020 independent valuation," the business said then.

The Singaporean Government was never mentioned. Nor was Reco Augustine Private, 100 per cent Singaporean and ultimately owned by a sovereign wealth fund established by the Singaporean Government. But it was Reco which bought that half share last year.