An extensively refurbished, award-winning office tower in the heart of Wellington’s Government precinct is attracting investor attention amid robust occupier appetite and demand for well-located, seismically compliant premises.
Recognised as a class-leading commercial asset on 929sqm (more or less) of freehold land at 22 The Terrace, the property is in prime position, accessible to State Highway 1, retail and transport offerings on adjacent Lambton Quay and the nearby railway station.
Bayleys Capital Commercial director Mark Hourigan says the property is offered to the market at a time of growing emphasis on environmental, social and governance (ESG) factors, and the performance of assets within the built environment.
“Recent climate events have challenged building integrity and bought risk-mitigation for properties front-and-centre for investors and occupiers.
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“Investors want to ensure longevity for their assets. At the same time, the office environment is viewed differently today, with a flight to quality buoyed by shifting employee expectations and consumer demand.
“On the other side of the ledger, first-tier lenders have emphasised the role of quality for assets on their books,” he says.
Mr Hourigan is marketing The Terrace premises for sale with Bayleys Capital Commercial colleague Grant Young.
The property is offered for sale by international tender closing at 4 pm, Wednesday 19th April 2023 (unless sold prior).
Recently benefitting from a $25 million-plus refurbishment and seismic strengthening, the 11-level office tower generates an annual net rent of $2,060,502 plus outgoings and GST, with 30.4% of this income derived from Government tenants.
Leading Wellington firm Gault Mitchell Law and financial advisory AdviceFirst New Zealand are amongst 15 tenants giving a 5.20-year WALE by income, and an average gross contract rental of $523/sqm for office floorspace.
Mr Young says the property is a secure, long-term investment in the heart of a thriving precinct which inherently provides promising rental growth upside.
It comprises a prominent office tower with a character two-level wooden cottage, located on the corner of The Terrace and Bolton Street with a floorplate totalling 4,813sqm (more or less).
There is one level of secure basement car parking and ground level parking for 18 vehicles, electric vehicle charging facilities, secure lockers and bike storage.
“The property has been upgraded to the highest specifications, offering a unique pedigree to secure key Government and private sector tenants.
“Sustainability initiatives have earned the property a 5-Star Green Design rating, in addition to Awards of Excellence in the Green Building and Commercial Office categories at the 2022 Property Council New Zealand Awards. It is also targeting a 5-Star NABERSNZ rating.
“The property has received a seismic assessment of 100% of New Building Standard to Yellow Chapter guidelines, which has reset the building’s structural life, offering the new owner security and confidence in the longevity of this asset.
“Refurbishment highlights, including the major works to the existing 80s structure, introduction of a film to enhance solar control, decarbonisation, rainwater harvesting and increased efficiency across all areas contribute to the building’s position as an extremely attractive, future-proofed office investment.
“Wellington’s office market remains a keenly sought-after investment destination given a scarcity of quality, well-located and modern premises. This is underpinned by strong tenant demand, particularly as occupiers seek accommodation to meet ESG objectives and increase productivity by attracting and retaining talent.
“Seismically compliant buildings, well-located relative to central Government, are also perennially in demand, and we expect this class-leading asset will generate strong attention from investors both within New Zealand and abroad,” Mr Young says.
Caption: Resilient assets are a current focus for commercial investors, with an extensively refurbished and seismically-strengthened office tower in Wellington’s central Government precinct expected to attract strong interest from purchasers at home and abroad.
- Article supplied by Bayleys
