Record price for new building
Christchurch has recorded its highest-priced office building sale, for about $80 million.
The seven-storey Manawa office building on Oxford Terrace near Christchurch Hospital in the city’s new Te Papa Hauora/Health Precinct was bought by Dutch national and retired lawyer, Wolf Herwegh Vonk, who moved to New Zealand with his family last year. They are living in Auckland.
Herwegh Vonk bought the building from Chinese property development company Huadu International, which bought out the original NewUrban Group, a joint venture between Huadu Construction and local investors John Fairhall and Bert Govan.
Despite the Covid-19 lockdowns, the property attracted more than $1 billion of offers from New Zealand and overseas investors.
It houses more than 2000 Ara nursing, midwifery and medical imaging students, as well as Canterbury District Health Board education and development staff and University of Canterbury staff.
CBRE NZ brokered the sale and CBRE managing director in Christchurch Tim Rookes said it was the highest-value single office building sale in the city.
The sale demonstrated the increasing attractiveness of goodquality, long-term commercial property investments in Christchurch, Rookes said.
The city was becoming more widely considered as a prime place to invest, as its CBD offered A-grade buildings constructed to a high standard after the earthquakes, Rookes said.
Savills New Zealand was the sole agent for the property and CBRE brought in the successful buyer.
Ryan Geddes, managing director of Savills New Zealand, said generally, international investors had not often considered Christchurch an attractive investment destination, so the serious offshore interest confirmed the superior characteristics of the Manawa building as well as the attractiveness of Christchurch’s CBD property market.
‘‘Opportunities to buy quality office assets in Auckland and Wellington are few and far between and Christchurch has brand new, quality stock with good long leases,’’ Geddes said.
The sale was market-changing for Christchurch. ‘‘This deal shows that what developers have been doing in Christchurch since the earthquakes has been right, and we now have strong demand for key assets in Christchurch.
‘‘People who have never looked at investing here are now saying ‘this is a good place to be’,’’ Geddes said.
It was Herwegh Vonk’s first real estate purchase in New Zealand and would be the cornerstone of a portfolio he planned to buy in New Zealand.
The strength of the tenant and the long lease made it a strong investment, Rookes said.
Herwegh Vonk, who had worked for many years in Japan and Switzerland, was a long-term investor and had plans for a philanthropic arts venture in Christchurch also.
The Health Precinct was taking off. Huadu International also had plans for two developments at 12 and 38 Oxford St, and Otago University’s planned development, would complete the precinct.
The sale demonstrated the increasing attractiveness of good-quality, long-term commercial property investments in Christchurch.
Tim Rookes
CBRE managing director, left