Chinese investors are selling an Auckland site for less than half what they bought it for, according to a real estate agent hunting for buyers who says the sale has been marked as urgent.
The site at 46 Upper Queen St was to be the site for the Basilica Apartmentsscheme and was bought for $7.5 million, said Auckland real estate agent James Law.
They would now sell it for "less than half of what they paid for it", Law said today.
CNSH Development engaged James Law Realty to sell the city fringe land as an "urgent sale", he said.
A valuation by real estate specialists in 2017 was $4.31m, Law said.
"The vendor is asking less than half of what they paid for it and they said they paid $7.5m," Law said.
"The vendor is overseas in China, selling this at a substantial loss. The vendor themselves have called for the sale," he said, telling how the owner had borrowed from a second-tier financier ASAP.
The property has been marketed for about a week and was 816sq m, zoned for mixed-use, and being sold by private treaty closing on July 29, unless sold prior.
"The resource and building consents for 46 Upper Queen Street were approved in 2016 and 35 premium apartments were proposed along with two shops and 37 car parks, designed by Moller Architects," Law said.
" The design used a minimalist design of palette of concrete, steel and glass taking design cues from the rose and the cross of St Benedict's Church nearby," he said.
The former developer had marketed the scheme as Basilica Apartments, and later cancelled and terminated all agreements on the apartment purchases, Law said.
"After the building consent for the apartment block lapsed in December 2018, the overseas vendor has now decided to exit the New Zealand development scene and sell this development site at a substantial loss," he said.
Basilica Apartments, as they were planned. Photo / James Law Realty
Companies Office records show CNSH Development is owned by Chenying Zhao of Shanghai. The company was registered in November 2017 and has two directors.
Publicity about the apartment scheme showed the new building was to rise in front of St Benedict's Church and to be nine levels high with a basement. Shops were planned for the Upper Queen St frontage.
Auckland Council records show the property is valued at $2.7m, a figure to be used for rates in 2020 and 2021. Value of improvements are listed as zero and the entire valuation is based on the worth of the land. Annual rates are $15,700. Building coverage is listed as zero and the land is listed as commercial and vacant.
In 2016, one agency found 35 Auckland apartment projects which had been cancelled in a one-year period.
Pete Evans, Colliers International's residential project marketing national director in Auckland, revealed the extent of the downturn in the sector three years ago.
"There's been 35 [developments] that haven't gone ahead in the last 12 months," Evans said in 2016 of apartments, terraced housing, townhouses and residential projects.
"Our research tracks that. Funding is often a risk and building costs going up is another reason," he said at the time.
Colliers marketed the cancelled Flo, the troubled Spring Park in Mt Wellington and Hemisphere apartments in Albany, Evans said then.
46 Upper Queen St. Photo / Peter Meecham
Many of the apartment projects had significant pre-sale levels but rising construction costs and problems getting funding had resulted in their cancellation.
Last month, the Herald reported how Chinese-owned developers plan an almost $11b pipeline of New Zealand projects in the next eight years, a new survey has found - and $2.1b of projects are already underway.
Frank Xu, president of the New Zealand Chinese Building Industry Association, said this was the finding of a survey of 26 Chinese-owned developers working in New Zealand in the past few years.
The property for sale is beneath St Benedicts St. Photo / Peter Meecham
Work by Chinese-owned developers forecast in this country during the next eight years was $10.69b, he said on June 10.
The survey found $1.7b of projects by Chinese-owned developers had been completed here since 2010. The bulk or 84 per cent are residential, 90 per cent are in Auckland, 12 per cent are commercial and 4 per cent industrial.
These companies have $2.1b of projects underway, a list that includes the Park Hyatt Hotel on Auckland's waterfront by Fu Wah International and the $300m 690-unit Sugartree Apartments in Auckland CBD.
