Kirkcaldie’s commits to upgrading historic Wellington office building
By Pattrick Smellie
Dec. 23 (BusinessDesk) – Kirkcaldie & Stains Ltd., the Wellington retailer and property owner, is to spend $5.5 million next year on refurbishing the Harbour City Tower building, next door to its flagship department store in Wellington’s central business district.
The plan includes earthquake-strengthening for the building, which has to be completed before 2030 – a date the Wellington City Council has mooted moving forward following the damage to heritage buildings in September’s Canterbury earthquake.
The refurbishment project will cut Kirkcaldie’s projected consolidated pre-tax earnings for the year to August 2011 to $500,000, down from a pre tax profit of $874,000 from the Aug. 31 2010 result, said chairman Denis Thom.
“These developments are expected to add significant value to the Harbour City Centre,” Thom said.
A key element of the refurbishment is retention of an “anchor tenant”, the Australian clothing and homeware store, Country Road, which will fit out its new space as a flagship store.
The announcement made no mention of retaining the headquarters of the country’s third largest listed company, Contact Energy Ltd., which occupies large areas on four floors of the six storey building once owned by a rival department store to Kirkcaldie’s, DIC.
Contact and Country Road share the ageing building with Kirkcaldies’ overflow shops, the offices of BusinessDesk and Scoop Media, and an assortment of dentists, lawyers, health providers and entrepreneurs.
A subsidiary company, Kirkcaldie & Stains Properties Ltd. will undertake the development.
“We have been working on options to strengthen the building for more than three years,” said Thom. “The works will bring the building up to the current code for new buildings while allowing for the retention of its beautiful heritage features.”
The statement came out after the market close, and shares last traded at $2.45 on Dec. 21, having dropped 14% this year.