JLL Assists ARE In Transformative $58m Auckland CBD Office Transaction
May 2021 – The recent purchase of two sites adjoining its 87 Albert Street property, for a combined $58 million, has allowed Auckland Real Estate Trust (ARE) to commence development of a transformative new office complex adjacent to the new Aotea CRL station and Sky City.
A new three-level link building will connect the three properties to create 14,500sqm of A-Grade office space and dining that will integrate seamlessly with Auckland’s future core infrastructure.
JLL NZ Senior Director, John Binning, who worked with ARE to advise on and secure the purchase of 60 Federal Street and 16 Kingston Street, says that Fusion’s contemporary design will be just as important as its strategic location.
“It is broadly understood that the work-life changes propelled by COVID-19 lockdowns won’t diminish the need for offices. However, our latest research shows that there is an ongoing flight to quality trend that is seeing vacancy in prime offices actually declining, while vacancy in secondary or older offices continues to rise. This is because occupiers are demanding more from landlords with regards to new and modern ways of working,” says Binning.
“ARE’s investment strategy to target value-add assets that are well located with significant vacancy due to neglect or age is a sound one. These older offices in the CBD that are left untouched can provide opportunities for investors as many of them are suited to repositioning to deliver growth.”
Fusion is the first major A-Grade office complex to be developed around the Aotea station, and ARE’s Executive Chairman, Andrew Saunders, is delighted to be playing a key role in the city’s revitalisation.
“The Fusion project is another positive step in developing our portfolio with the objective of providing businesses with modern, post-Covid workspaces,” says Saunders.
“The location next to both SkyCity and the Aotea train station, which is expected to be Auckland’s busiest transport hub upon completion, continues our investment strategy executed successfully at 1 Albert Street.”
With resource consent granted and works already underway, ARE anticipates Fusion to be completed within the next 18 months at a forecast cost of around $25 million.