ACQUISITION OF 35 GRAHAM STREET, AUCKLAND
Asset Plus (NZX: APL) is pleased to announce that it has entered into a conditional agreement to acquire 35 Graham Street, Auckland for $58 million from Auckland Council. The agreement is conditional on the approval of an ordinary resolution of Asset Plus shareholders at a meeting expected to be held in the first two weeks of June.
35 Graham Street is currently occupied by Auckland Council who have agreed to enter into a lease for a two year term from settlement (expected to be 28 June) with no rights of renewal.
The property currently has a net lettable area of 9,990m2 with extensive floor plates of circa 3,000 to 3,500m2 and the upper floors providing expansive views across the Waitemata Harbour. The acquisition fits within Asset Plus’ “value-add” investment strategy as not only does the purchase price represent a strong initial yield of 6.85% but the property has considerable potential for a re-positioning at the end of the lease term. Potential options include various levels of refurbishment and re-leasing of the existing floors through to the addition of a further two to three levels of Grade A office space.
“A number of key corporate tenants have lease expiries over the coming years which should match well with the timing for redevelopment of the property”, commented Bruce Cotterill, Asset Plus Chairman. “Once refurbished, we expect the expansive floor plates and extensive views will be attractive to a number of these tenants. The Augusta team will be pursuing these potential leads immediately.”
The acquisition will be funded by a debt facility from BNZ and will be accretive to earnings. Further detail on the acquisition will be provided in a notice of meeting which is expected to be released in mid-May.
For further information please contact:
Chairman, Asset Plus Ltd
021 668 881
Managing Director, Augusta Funds Management Ltd, Manager of Asset Plus
09 300 6161
Chief Operating Officer, Augusta Funds Management Ltd, Manager of Asset Plus
09 358 7933