Rivals compete for central site

LIZ MCDONALD AND MARTA STEEMAN
Last updated 05:00 24/12/2012
Apollo Group's plans for City Mall
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VISION: Artist's impression of merchant bank Ocean Partners and project managers Apollo Group's plans for City Mall.

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The race to develop City Mall is all on with one would-be developer confirming its first land purchase and a new contender emerging for the site.

Ocean Partners, a Christchurch merchant bank partnered with Apollo Projects, has set up a fund to finance its proposed $200 million office and retail complex called One Cashel Square.

Its competitors are Westpac-Goodman Property with a rival $350m retail and office block proposal, and Re:Start duo Leighs Construction and the Buchan Group. A fourth player has now emerged in leasing agent Chase Commercial, whose plan for a multi-storey precinct called West End would let small owners keep their sites.

The block being fought over borders Cashel St, Oxford Tce, Lichfield St and Plymouth Lane, while the Westpac-Goodman plan extends up to Ballantynes department store.

To succeed, each group must buy or gain rights to the land from the dozen-plus owners in the block. Both Westpac-Goodman and Ocean-Apollo have resource consent, but have yet to gain control of the land.

Brendan Chase of Chase Commercial said his West End plan would co-ordinate owner-driven redevelopment of several "substantial" office and retail buildings around a central courtyard.

"I'm obviously concerned there is a contest for the land. My plan won't need control because these people already own it - it's driven by what they want to do."

Meanwhile Tim Howe of Ocean Partners said they had raised enough money to make their first land purchase and some others through a new fund, Christchurch Provident Investment Company.

The first block of land is 1000sqm on Lichfield St, the Loyal Canterbury Lodge site previously owned by Manchester Unity Friendly Society. Howe said the fund had contracts with other land owners "in progress", and "slightly under" $10m from South Island investors "with an interest in Christchurch".

"They're just conservative long-term property investors who have seen this as an opportunity to get into a project."

The fund would seek to raise more capital in the New Year.

Howe said it was up to the landowners to choose who they sold to. "It will be jungle law of the precinct, and that will be whichever one can acquire or get control of the majority of the land and getting alignment with the parties [landowners]."

Westpac would not comment, and Goodman Property chief executive John Dakin said the company did not comment on the commercial activities of other parties. Goodman was talking to the landowners on the block "but at this stage we haven't made any acquisitions," Dakin said.

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They were still assessing what plan was best for the city and it had to be commercially viable, he said.

Asked what might happen if Westpac Goodman and the Christchurch Provident fund both secured some land in the block, Dakin said: "We'll cross that bridge when we come to it."

Meanwhile investor and developer Richard Diver confirmed he has bought a 1100sqm site in the block, the former Bog pub site at 82 to 86 Cashel St, and has made offers on four others.

Diver confirmed he was talking to Westpac about on-selling them his land, but would not say whether they had made him an offer.

"Westpac would be my preference, they have got the money and Goodman has the track record. This is a substantial development and I don't know whether Ocean Partners have the expertise to do it.

"I don't think someone who doesn't know about property can do a $200m or $300m development like this, and we need to get it right for the city."

- © Fairfax NZ News

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