PASTORAL HOUSE A PREMIUM COMMERCIAL INVESTMENT OPPORTUNIT Y - Oyster Property Group
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A P R E M I U M CO M M E RC I A L I N V E S T M E N T O P P O R T U N I T Y
PASTORAL HOUSE
N e w Z e a l a n d G o v e r n m e n t T e n a n t | W E L L I N G T O N C B D | L o n g -T e r m R e n t a l G r o w t h
6
MINIMUM INVESTMENT $50,000 2
% P.A FORECAST PRE-TAX
CASH DISTRIBUTION , PAYBALE MONTHLY1
25 THE TERR ACE / 92 L AMBTON QUAY, WELLINGTON
1
The return is only an indicative return and is for the financial period ending 31 March 2022.
2
Minimum investment is $50,000 and multiples of $50,000 thereafter.
OYSTERGROUP.CO.NZ
INVESTMENT HIGHLIGHTS New Zealand Long-Term Significant Sought-After Government Tenant Rental Growth Property Location Offices to be 100% leased to the New Zealand Weighted Average Lease Term will be 14.04 years on 18-storey office building comprises ground floor retail, Well-located and easily accessible within the Wellington Government on a new 15-year lease with the Ministry settlement of the property4 and the leases to MBIE offer two podium levels of office accommodation, a podium CBD in the heart of the parliamentary precinct. of Business, Innovation and Employment (MBIE). fixed 1.5% rental increases p.a. and a market rent review car park, and 15 levels of tower office accommodation. The New Zealand Government office leases account every six years³. Recently strengthened with substantial refurbishment for 90% of the property rental. underway to the office floors and lobby.
FRO M S T RE N G T H TO S T RE N G T H
WELLINGTON OFFICE SECTOR
THE LOCATION
R E CO R D L OW S PAC E AVA I L A B I L I T Y
Pastoral House, a commercial office building, is exceptionally
The latest Colliers International Occupier Survey highlights Total office supply is at approximately 1.38 million sqm, well
located at 25 The Terrace / 92 Lambton Quay, Wellington in
that tenant demand is present for all qualities of office space. down from the peak of 1.61 million sqm of space in 2011.
the heart of the parliamentary precinct.
The prime (premium and A-grade) vacancy rate is at 0.4% Due to tight leasing conditions, owners are refurbishing,
with just 1,100 sqm available for lease and the secondary seismic strengthening and developing new premises. While
(B-grade and lower) vacancy rate is at 7.3% with 80,300 more than 74,800 sqm of new office space is forecast to be
sqm available for lease. Both vacancy rate metrics are at the added to total supply over the next few years, it is only likely
lowest rates in almost a decade. to help alleviate some of the current acute space shortages.
THE PROPERTY A continuation of solid market conditions is signalled by
recent announcements from the public and private sector to
Pastoral House has been recently seismically upgraded pre-commit to future available space.
and the office floors are in the process of being substantially O F F I C E P R I M E A N D S E C O N D A R Y VA C A N C Y R AT E S
refurbished. Situated on a single freehold land holding, with 20%
a net lettable area of 15,960m². The 18-storey office building
O F F I C E VA C A N C Y R AT E
18%
WGTN CBD
offers dual access via The Terrace and Lambton Quay, PRIME 16%
Forecast
14%
comprising Lambton Quay fronting retail tenancies,
12%
two podium levels of office accommodation, a podium car
WGTN CBD 10%
park, and 15 levels of office accommodation above. S ECONDARY 8%
6%
4%
WGTN CBD 2%
OVER ALL 0%
THE TENANTS
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On completion of the refurbishment, the office floors are
to be leased to the Ministry of Business, Innovation and
RENTS RISING AND YIELDS FIRMING
Employment (MBIE) for 15 years with fixed annual rental
growth of 1.5% p.a. and six yearly market rent reviews³. The Occupier demand outweighing supply along with rising Solid market fundamentals and low interest rates have
New Zealand Government office leases account for 90% of the operating costs have led to average prime gross face rents created positive investment conditions for buildings of
rental of the property providing an excellent covenant. increasing strongly over the past year. Landlords with office B-grade quality and higher in the CBD Core. Average initial
buildings in the Wellington CBD Core precinct command the yields for this quality of office premises currently ranges
Further ground floor retail is leased to NZ Post (Kiwibank), highest rents, with premium office buildings now achieving between 5.75% and 6.40%, firming approximately 40
BNZ and two cafes, the expected Weighted Average Lease average gross face rents well above $700 per sqm. Average and 60 basis points from a year ago. Given the positive
Term is 14.04 years on settlement of the property4. gross face A-grade rents range between $550 per sqm and prospects for the sector, buoyant investment conditions
$650 per sqm, while average gross face B-grade rents range for the Wellington CBD office sector are set to continue.
between $385 per sqm and $535 per sqm. The delivery of
new premium grade buildings in the precinct in the next five
years will likely see rents at significantly higher rates, which
THE MANAGER will help lift all average rents further over the next few years.
O FFI CE PRI M E A ND S ECO NDA RY INI T I A L Y IE L DS
Oyster is a leading New Zealand commercial property and
14%
fund manager. The company has expertise in property fund
12%
structuring and equity raising, and currently manages over 20
OFFICE YIELDS
Forecast
property funds structured for retail and wholesale investors, WGTN CBD 10%
including Oyster Industrial and the diversified Oyster Direct PRIME
8%
Property Fund. Oyster manages a range of retail, office and
6%
industrial assets throughout New Zealand, with a combined WGTN CBD
S ECONDARY 4%
value in excess of $1.7 billion.
2%
0%
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³ Six yearly market reviews with 10% cap and collar.
4
Assuming the new MBIE lease commences on 1 March 2020 and BNZ Branch Properties
Limited does not renew its lease.
Source: Colliers International Research
Please refer to colliers.co.nz/find-research for more information.
THE OFFER Key INFORMATION
Oyster Management Limited is offering investors the Purchase Price $77,000,000
opportunity through a proportionate ownership scheme
to acquire a proportionate share of, and beneficial interest Valuation $77,000,000
in, the land and building at 25 The Terrace / 92 Lambton
Quay, Wellington. Loan to Value Ratio5 48.4%
Interests are being offered at $50,000 each.
Investment Size $50,000 per interest
Investors may apply for one or more interest(s).
Total Interests6 887
Gross Rental $6,382,306 per annum
Forecast Pre-Tax Cash 6% per annum,
Return to Investor payable monthly1
Oyster Management Limited is the manager and the issuer of interests
in the Pastoral House Proportionate Ownership Scheme.
Contact Oyster or Colliers as soon as possible to register your
interest and for a copy of the Product Disclosure Statement.
RICH LYONS 021 841 960 CHARLIE OSCROFT 021 824 564
rich.lyons@oystergroup.co.nz charlie.oscroft@colliers.com
GENEVIEVE TAYLOR-FORD 021 0220 7672 KRIS ONGLEY 021 657 687
genevieve@oystergroup.co.nz kris.ongley@colliers.com
COLLIERS INTERNATIONAL LTD
LICENSED UNDER REAA 2008
1
The return is only an indicative return and is for the financial period ending 31 March 2022.
2
Minimum investment is $50,000 and multiples of $50,000 thereafter.
5
The gearing ratio is how much the scheme owes to the bank as a portion of its assets including cash.
6
The Sale and Purchase Agreement recognises that the final rent payable by MBIE may adjust as a consequence of a final measurement of the MBIE tenancies that will be undertaken prior to
settlement and may be subject to a purchase price adjustment.
The Product Disclosure Statement contains details of how the forecast return and investment is be calculated. The forecast return is based on any principle assumptions and method of
calculation described in the Product Disclosure Statement. Prospective investors are recommended to seek professional advice from a financial adviser which considers their personal
circumstances before making an investment decision. This offer is made in accordance with the Financial Markets Conduct Act 2013.
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