A lack of accommodation at the growing Albany town centre area prompted a new $6 million construction job.
In the midst of the building slump, developer McDougall Reidy is having 38 apartments built for its associate, unlisted Auckland real estate investor Direct Property Fund, which has a $387 million real
estate portfolio.
The property will be leased to Quest Serviced Apartments.
Stephen Mansfield, chief executive of Quest in New Zealand and Fiji, said Albany had little accommodation yet strong demand. The new block is on a laneway behind Albany Village, on the west side not clearly visible from the main highway but at the Massey University end of the village.
Quest Serviced Apartments has more than 130 properties in New Zealand, Fiji and Australia, where it targets central business districts, suburban and regional areas close to head offices, business centres and tourist spots. The business is aiming to shift into Petone, Lower Hutt, Tauranga, Nelson, North Shore City, Waitakere, the outer areas of the Christchurch CBD and outer Wellington.
Quest on Hobson at 127 Hobson St, in the CBD, is due to open in the next few months. Quest Petone at 230 Jackson St will open next March.
Highbrook business park, being developed by Goodman Property Trust, is another target and a Quest has been designed for the expanded town centre planned at that East Tamaki site. Mansfield said the large number of workers there and its location made it an ideal Quest site.
Quest is an Australian business which started in Melbourne in 1988 and is now chaired by Paul Constantinou. Mansfield, an Australian, got the rights to bring the business to New Zealand in 1997 and since then, Quest established 29 outlets here.
Quest describes itself as "a business format franchisor, not a property development or ownership company", so its formula is to separate real estate from accommodation operations.
Greg Reidy, of McDougall Reidy, said Massey University's Albany campus and North Harbour Stadium conference-goers would be key targets of Quest Albany, but generally that part of the Shore needed more accommodation. The corporate market was under-serviced in the area where he said some businesspeople were forced to stay "out in a paddock", referring to the nearby Albany accommodation block to the southern end of the area.
Quest would be near restaurants and other amenities in Albany village.
Mansfield said Quest took long leases on properties, sometimes up to 20 or 30 years. Quest, which strikes the lease then negotiates to franchise the businesses out to an operator, might pay hundreds of thousands of dollars annually to lease a property like Albany, he said. But the business generally aimed to make around $1.2 million annual gross revenue from each of its New Zealand properties so stood to make good profit once outgoings were deducted.
Albany Village Quest, as the block will be known, will be open before the start of the Rugby World Cup. The Woodhams/Meikle/Zhan designed block, built by Haydn & Rollett Construction is due to be finished by August.
Direct Property Fund said the village site was chosen because the stadium was one of the major hosting venues for the Rugby World Cup, adding "significant capacity" to the North Shore.
Direct owns 35 properties with an average weighted lease term of 7.4 years. Manager Simon Woodhams said the Albany site was bought in 2007 and was the second between Quest and Direct. Direct's largest new investment is three Stanley St buildings in Grafton Gully worth more than $125 million on the old Carlaw Park sports site and a Quest operates from there.
Reidy said Direct also owns adjoining properties at Albany, initially planned to be residential units but now leased to Massey University.
PURSUING NZ
Existing Quest properties
Auckland:
Quest Auckland
Quest Carlaw Park
Quest Henderson
Quest on Cintra Lane
Quest on Eden
Quest on Mount
Quest on Nelson
Quest Newmarket
Quest Parnell
Quest Ponsonby
Quest on Queen
Wellington:
Quest Atrium
Quest on Johnston
Quest on Lambton
Quest St Pauls
Quest on The Terrace
Quest Wellington
Quest on Willis
North Island
Quest Mt Maunganui
Quest Napier
Quest New Plymouth
Quest Palmerston North
Quest Rotorua
Quest Taupo
Quest on Ward, Hamilton
South Island
Quest Christchurch
Quest Dunedin
Quest Invercargill
Source: Quest NZ
Albany Village Quest is on target to be completed in time for the Rugby World Cup. Photo/ Brett Phibbs
A lack of accommodation at the growing Albany town centre area prompted a new $6 million construction job.
In the midst of the building slump, developer McDougall Reidy is having 38 apartments built for its associate, unlisted Auckland real estate investor Direct Property Fund, which has a $387 million real
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