New apartment buildings in Auckland are attracting the interest of big overseas players from countries like Singapore who are used to residential high-rises and intensification, says Harcourts JK Realty owner David Findlay.
Findlay, whose agency is based in Mt Albert, says there is a new trend for buyers to purchase whole apartment buildings and he has several projects on the go, including in Mt Eden and Papatoetoe.
The Auckland Unitary Plan and the government’s National Policy Statement on Urban Development has allowed for more intensive and taller residential buildings, including around transport hubs, and New Zealand is now on the radar with international companies wanting to invest.
Findlay says buyers want a yield of between 5% and 7%, and are often looking to build large property portfolios.
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His agency has just sold a near-new apartment building at 661 Dominion Road, in Mount Eden, as an entire building.
Initially advertised as eight separate apartments also with a commercial area, the sale of the building as a single unit settled this week.
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While slightly different in that this building was sold to a large New Zealand company looking to build its portfolio, and not an overseas company, Findlay says the sale aligns with other such buyers wanting to buy high intensity, high yield projects.
He says he has been approached by Singaporean buyers, for example, who are looking to acquire entire buildings so they have more direct control over their assets. Some New Zealand developers and builders have even reached out to overseas investors, saying: “Hey, if you buy it off us, this is what we will build.”
“Because of the Unitary Plan allowing more intensification all of a sudden it’s kind of come on their radar, whereas before we weren’t even on the radar,” Findlay says.
One of apartments in the Dominion Road block. Photo / Supplied
A luxury apartment block at 719 Remuera Road, on the border of Remuera and Meadowbank, in Auckland, sold for an undisclosed price earlier this year. Photo / Supplied
“The trend is these guys are looking for multiple projects not just one,” Findlay says.
“We've got multiple buyers that are coming now wanting to buy full projects whether completed or near completed.”
The agent that marketed the building at 661 Dominion Road, Brody Hart, says he had been approached by the vendor who was looking to sell the property after it failed to sell with another agency.
He says the apartments were advertised individually at first and they would have suited the likes of first-home buyers.
Hart says it was a great deal in the current market conditions, and both vendor and buyer were happy with the bulk buy, which OneRoof understands to be in the $7 million-plus bracket.
It was “amazing” to sell the whole building, he says, adding that another buyer had shown interest.
The steel and concrete tilt slab building was finished in 2021 and, Hart says, the apartments are stylish and are finished to a high standard.
The Dominion Road block is not the first high-profile development to sell to a single buyer.
Earlier this year OneRoof reported that a luxury development in one of Auckland's most affluent neighbourhoods had sold for an undisclosed price after failing to find buyers for the individual units.
The developers of 719 Remuera Road, in Meadowbank, had been prepared to sell at a loss, amid turmoil in the wider residential development market in the city.
The block comprised five high-end apartments, which had been priced between more than $2m and $3.5m at the end of last year.
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