BNZ 'reconsidering' NZ$46.3 mln purchase of site for Christchurch HQ after the earthquake

BNZ 'reconsidering' NZ$46.3 mln purchase of site for Christchurch HQ after the earthquake

By Gareth Vaughan

The Bank of New Zealand (BNZ) is "reconsidering" whether to go ahead with the NZ$46.3 million acquisition of a leasehold interest in a central Christchurch site for its head office in the garden city following the devastating February 22 earthquake.

BNZ's potential purchase at 772 Colombo Street was revealed by the release of an Overseas Investment Office (OIO) decision - dated February 28 - yesterday granting consent for the deal. OIO approval was required because BNZ is a subsidiary of National Australia Bank.

A BNZ spokeswoman said the bank had been planning to lease space in a proposed development to be undertaken by the Carter Group. The OIO decision names the seller as Andrew Centre Ltd, whose two shareholders are Philip Carter and Michael Ryan.

The OIO decision notes the BNZ intends to lease 4,000 square metres including car parks and ancillary facilities on which it will build its Christchurch head office. The building was to incorporate part of the existing historic facade located on the site.

The BNZ spokeswoman said the OIO's decision summary reflects its calculation of the potential 24 years lease tenure value for the space.

"The proposed development design incorporated a portion of a heritage facade and although this facade was not part of the space BNZ proposed to occupy its inclusion triggered OIO approval," she said.

"Recent events necessitate both parties to reconsider whether or not they proceed with the original concept, an alternative to it, or at all. It will be some months before any decision is reached."

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I can't imagine them wanting to proceed on that site in it's present form.  The site is opposite the wrecked Forsyth Barr building and just along from the badly damaged Victoria Apartments.

The facade is still standing - just.

Obviously BNZ need a new base asap now since it's Cathedral Sq building needs to come down (I understand they have temporarily "double bunked" in their Riccarton office).

It's hard to gauge much from the $46.3m number.  Obviously a $2m annual rental is at the top end for ChCh (unsure if we are talking a net present value total or if rent increases are factored in) but if it is around $500/m2 then that's top dollar and Phillip Carter will be doing alright.

The site's had several failed proposals, during the past 20 years.  The EQ may have made yet another fall over.