Precinct Properties eyes new developments after Commercial Bay

The Commercial Bay project itself is on schedule for the retail centre to open in March and the office tower in April, says Precinct boss Scott Pritchard. Photo / File

Precinct Properties New Zealand says it is looking at future developments including at One Queen Street, the next stages at Wynyard Quarter, both in Auckland, and the Bowen Campus in Wellington.

"One Queen Street is now in the detailed design phase. Construction remains on schedule to commence midway through next year and we are excited about introducing a hotel into the Commercial Bay Precinct," chief executive Scott Pritchard told the annual shareholders' meeting.

The Commercial Bay project itself is on schedule for the retail centre to open in March and the office tower in April, Pritchard said in speech notes prepared for the meeting. That's about a year later than originally planned.

About 98 per cent of the retail space at Commercial Bay is now leased, an advance on the 95 per cent announced in August, while leasing of the office space remains at 82 per cent.

Pritchard said a number of office leases are under negotiation.

"The office tower continues to attract good interest from the market where occupiers are looking to locate in a world-class modern workspace with remarkable views across the harbour," he said.

Fletcher Building is the lead contractor on the Commercial Bay project and Precinct said in August that it had withheld $34 million of liquidated damages. Pritchard didn't say anything about this in today's speech.

Another troubled Fletcher project, the SkyCity international convention centre and hotel project, suffered a severe blow when its roof caught fire causing as yet unquantified damage.

Fletcher had already been struggling to retain workers and subcontractors and it has confirmed it has diverted those unable to work on the SkyCity project to the Commercial Bay site.

"Fletcher Construction has worked with subcontractors where possible to redeploy them from the NZICC site to Commercial Bay while the plans for re-entry, recovery and rebuild of the convention centre are underway. This will allow subcontractors to be deployed back at the NZICC site when work there is able to start," a Fletcher spokesperson said.

Pritchard told the meeting that stage two at Wynyard Quarter is progressing well and is fully leased a year ahead of practical completion. It remains on budget and slightly ahead of programme.

The New Zealand Defence Force has moved into the Defence House part of stage one of the Bowen Campus following completion of its fitout in October while the Ministry for Primary Industries now occupies the Charles Ferguson Building.

Pritchard said Precinct is well-positioned to create further shareholder value. "We have a strong balance sheet to pursue future opportunities and we are especially pleased to lift our dividends to shareholders for the full-year 2020 year by 5 per cent," he said.

Full-year dividends in 2019 were 6 cents per share and the company expects to pay 6.3 cents per share in the current financial year.

It will pay a first-quarter dividend of 1.575 cents per share on December 12 to those on the register on November 28.

Precinct shares increased 0.3 per cent to $1.75.