Jardine BNZ Auction Signals End Of Era

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JARDINE BANK OF NEW ZEALAND AUCTION SIGNALS END OF BRANCH SALE-AND- LEASEBACK ERA

Eleven Bank of New Zealand branches will go under the auctioneer's hammer in Auckland this Friday [October 15], signaling the end of the BNZ's era of branch sale-and-leasebacks.

The branches - Kaikohe, Kerikeri, Dargaville, Milford, Henderson, Glen Eden, Avondale, Frankton, Whakatane, Gisborne and Paraparaumu - are for sale through corporate services company Colliers Jardine.

Colliers Jardine sold 45 BNZ branches in 1996 and another 26 earlier this year, and with enquiry levels similar to those of previous campaigns, director Mr Michael Judd is predicting "all branches will sell under the hammer this Friday.

"This is the last chance for investors to own a Bank of New Zealand branch on a six-year leaseback term, plus three rights of renewal, each of three years."

He said interest has traditionally come from local people, who tend to have the best view of the strength of their own regional economies.

Mr Judd said branches sold in previous auctions were now coming up for their first rent reviews, and some existing owners, impressed with the performance of their investments, have indicated they will be at Friday's auction to add to their portfolios.

Their initial yields have ranged from about eight to about 14 percent, with the average about 11 percent.

"The message to investors is if you're interested be at the auction - the branches will be sold," said Mr Judd. "The Bank has historically proven to be a willing seller."

Bank of New Zealand head of corporate real estate, Mr David Browne, said there will be no change to the operations of the branches - the Bank simply becomes the building's tenant, rather than the owner.

The sale-and-leaseback programme frees up funds to allow the Bank to concentrate even more on looking after the needs of customers.

The auction starts at 11am on Friday at the Hyatt Regency in Auckland.

Four other Bank of New Zealand branches - New Plymouth, Hastings, New Brighton and Timaru - are for sale through Colliers Jardine by deadline private treaty, with offers closing the following Friday, October 22.

ENDS....

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