Wellington Scoop

Property investor buying two buildings near Parliament

Bowen House to the left
Bowen House to the left of the Beehive. Photo from RNZ.

Report from RNZ
Property investor and developer Precinct Properties is to raise $250 million to buy two major Wellington properties and reduce debt.

The company has agreed to buy Bowen House and is currently doing due diligence on acquiring the Freyberg Building, both of which are close to parliament and have housed government departments.

“The Wellington market continues to show strong demand for prime grade office, underpinned by an increase in the public sector workforce. We are seeing solid rental growth and very low levels of prime vacancy,” chief executive Scott Pritchard said.

Bowen House accommodated MPs and staff until it was recently vacated. Precinct was to pay $92m for the building and would spend another $57m on refurbishing it, after which the parliamentary service would lease the building for 15 years.

Precinct has agreed on broad terms for acquiring the nearby Freyberg Building, which also houses government departments.

“On completion of the acquisition, Precinct anticipates progressing with design for the redevelopment while benefiting from holding income.”

The company will issue new shares at $1.51 each, a 5 percent discount to Precinct’s last traded price. Major investors will be offered $220m worth and $30m has been reserved for current shareholders. The balance of the capital raising would be used to reduce the company’s debt levels, giving it headroom for further developments.

Precinct’s major shareholder, Haumi, planned to buy shares to maintain its 15 percent holding.

Precinct has a broad range of office and retail buildings in Auckland and Wellington, including the recently completed Commercial Bay development on Auckland’s waterfront.

Press Release – Chapman Tripp
Chapman Tripp is pleased to be assisting Precinct Properties New Zealand Limited in its $250 million equity raising. Precinct has agreed to acquire two Wellington office buildings – Bowen House and the Freyberg Building.

The raise is in two parts; a fully underwritten placement of $220m and a retail offer in the form of a supersized share purchase plan offer to raise up $50,000 per beneficial shareholder, representing up to $30m in total with the ability to accept oversubscriptions at Precinct’s discretion.

Jarden Partners is the underwriter and Jarden Securities the sole bookrunner and lead manager. Precinct’s largest shareholder holding 17% of its shares has pre-committed to bid in the placement.

The Chapman Tripp team is led by Roger Wallis and comprises Liam Stoneley and Sara Yacoub.

Because New Zealand banks no longer accept cheques, the offer may only be accepted electronically through the retail offer website www.shareoffer.co.nz/precinct, with all payments by direct credit. There are, therefore, no paper application forms, and shareholders with only postal addresses will simply be sent a letter of entitlement linking to the online-only offer document.

Chapman Tripp recently worked with other NZX listed clients Me Today and Savor on similar novel offer structures.

“We’re grateful to Precinct for letting us in on the ground floor of this opportunity,” Wallis said.

“It represents a vote of confidence in the Wellington commercial property market and features some design innovations which make it the sort of work that Chapman Tripp likes to engage with, and has built a reputation for.”

Russell McVeagh is acting for the underwriter and Baker & McKenzie is providing foreign law advice.

Chapman Tripp also had the lead role in advising Precinct in its ground-breaking $150m six year green bond issuance in May 2021.

Content Sourced from scoop.co.nz
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1 comment:

  1. Greenwelly, 21. June 2021, 9:53

    after which the parliamentary service would lease the building for 15 years.
    So I guess Mallard’s vision for a new parliamentary building on their rear carpark has bitten the dust…