Tenants renew AMP leases

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Stock-exchange-listed property trust AMP reports that it has renewed leases covering 25 floors of office space in the past few weeks.

AMP NZ Office Trust, part of the AMP group, is one of New Zealand's biggest office landlords, owning 15 buildings, together worth $1.3 billion in Auckland and Wellington.

A revaluation of the trust's portfolio in June determined the value of its portfolio had fallen by $239.10 million, more that 15 per cent in a year, caused by the recession and the credit crisis.

In the past eight weeks, the trust has resigned eight tenants for leases covering more than 23,000 of space and $7.92 in annual rents.

However, the trust is still looking for tenants for 21 Queen St, an 18-storey downtown Auckland office tower it bought and revamped at a cost of about $100 million, but has been unable to lease.

Chief executive Robert Lang said said that despite times being tough, all the tenants who re-signed had kept the same amount of space.

"Remaining in their current premises has become a logical choice for many central-business-district office tenants in the current economic environment," Lang said. "By staying put, they avoid a range of costs associated with a move to new premises: fitout costs, information- technology costs, relocation costs and business disruption."

In some big overseas office markets, businesses were upgrading to better premises to take advantage of lower rentals.

The trust's tenants include financial services company AXA, the New Zealand Fire Service, Vodafone, insurer IAG, Microsoft, and the ANZ bank.

- © Fairfax NZ News