Scott Pritchard, Precinct Properties' chief executive, explains the big apartment sector investment. Video / Michael Craig
NZX-listed landlord Precinct Properties is making a $300 million-plus Auckland apartment development push in a three-pronged strategy announced by chief executive Scott Pritchard today.
Building a 500-unit $100m+ student accommodation tower at 256 Queen St, “to be a tall building, up to 30 levels”;
New Mt Eden apartments on Eke Panuku land, 198-222 Dominion Rd and 113-117 Valley Rd, across from Woolworths;
Buying half of developer Lamont and Co which Precinct does not already own, with founders Tim and Andrew remaining for five years.
“This is a clear signal of our commitment to moving into the living sector,” Pritchard told the Herald yesterday from 101 Carlton Gore Rd.
That isthe site of a display suite for the neighbouring Domain Collection office-to-residential conversion by Precinct, a joint venture with Lamont & Co.
Precint Properties' CEO Scott Pritchard today announced the $300m push further into the apartment sector. Photo / Michael Craig
“All up, it will be more than $300m [investment],” Pritchard said of the three new deals announced today.
The company plans to enter 25 per cent to 50 per cent arrangements with major investors like GIC or PAG, already on other deals with Precinct, he said.
The proposed twin towers on the site of the Downtown carpark building in Auckland.
In addition to these three moves, Pritchard said today Precinct was already advancing plans for around 350 new apartments on the Downtown Carpark site near the waterfront in that joint venture with Ngāti Whātua Ōrākei for two slim towers nearly 40 storeys high, above the M Social hotel on Quay St.
A statement to the NZX said of today’s three moves: “Precinct is well positioned to participate in this sector, with the combination of its development expertise and the successful delivery of exemplar projects such as Commercial Bay, One Queen Street, the Intercontinental Hotel and Bowen Campus, along with deep city centre knowledge, residential development experience and its capital partnering platform.
Precinct Properties plans to buy 198-222 Dominion Rd and 113-117 Valley Rd in Mount Eden for apartments. The land is outlined in red.
“Precinct’s progress on its residential build-to-sell pipeline is demonstrated with today’s announcement of an agreement with Eke Panuku to conditionally acquire and redevelop the 5250sq m residential and commercial site of 198-222 Dominion Road and 113-117 Valley Road in Mt Eden. The site has frontages to both Dominion and Valley Roads,” the company said.
The company is buying that Eke Panuku site for $13.25m, expected to settle early next year.
Apartments are to be developed and sold, although Pritchard said units in the new Queen St student accommodation tower would be rented and retained by Precinct so effectively that is the company’s first build-to-rent project.
Precinct isn’t saying what it is paying the Lamonts to buy the remaining 50 per cent of their business.
In the CBD, Precinct is buying 256 Queen St for $9m in a sale due to settle this month.
Pritchard said Precinct would retain the character building in the block between Wellesley St and Victoria St West beside McDonald’s.
256 Queen St, Auckland CBD: Precinct is buying this for a towering student accommodation block, retaining this character building. Photo / Google Street View
“The building at 256 Queen St, with a frontage to Lorne St, is ideally located for a purpose-built student accommodation development near the [Auckland] University and midtown Auckland amenities. Initial designs show potential for over 500 self-contained studio units, bringing an inspiring new standard of student accommodation to Auckland city. The development of the site will include the restoration of the historic Auckland Savings Bank building as a separate retail and commercial component,” he said.
Precinct saw significant potential and value in student accommodation, he said.
At Newmarket’s under-conversion Domain Collection apartment project, Pritchard said deposits had been taken on around 40 per cent of those, marketed from $1.5m to $8m each in that project due for completion in 2026.
Precinct had until around two years ago developed only commercial and for its own balance sheet.
“We’ve started developing mixed-use developments and more recently in the last two years, we’re now moving into this living sector, taking a long-term view. We feel that through the Auckland Unitary Plan, the amount of immigration that’s occurring in New Zealand and most of which is going to Auckland - we see a real demand for high-density high-quality apartment living in the city centre and the inner-city fringe. We feel like that’s a position or a market that we can really play in over the next 10 years or so,” he told the Herald.
