A central Christchurch landowner has abandoned development plans for a high-profile site, leaving a major retailer and investor to step into the breach.
Long-time Triangle Centre landlord Michael Ogilvie-Lee has dropped his concept for a $100 million sculptural glass-wrapped office and shopping centre between Colombo, High and Cashel streets.
Ogilvie-Lee has joined others in abandoning plans in the face of high construction costs, reluctant tenants and uncertainty over car parking.
The land has been bought by CHC Properties, jointly owned by fashion retailer, investor and rich-lister Tim Glasson, and fellow Hallenstein Glasson shareholder and chairman Warren Bell. The price for the land was $13.5m.
Glasson said he was not yet ready to talk publicly about his plans for the block. However, he is understood to be working on a development concept.
With several projects shelved in the 18 months since the Government's blueprint for the city's retail core was unveiled, local rich-listers look like being best-placed to get plans off the ground.
Glasson was estimated by the National Business Review's 2013 Rich List to be worth $85m.
Antony Gough, whose family's wealth was estimated at $300m, is the only landowner with construction under way around City Mall.
Philip Carter, listed as Christchurch's richest man with $120m, has plans to build a precinct on land between Colombo, Cashel, High and Lichfield streets.
Also hoping to start building soon is Nick Hunt, who is holding insurance payouts for lost buildings but has not yet confirmed a tenant for his Cashel Square precinct.
Ogilvie-Lee, through his company OLT Properties, had owned the Triangle Centre for 10 years and last year drew up a dramatic rebuilding plan. The precinct was to have three buildings, four and five storeys high, linked by an atrium, escalators and underground car parking.
The design received resource consent but the company struggled to attract tenants who were prepared to pay the rent needed to build it.
Others to have abandoned major plans include the McFarlane Group, which sold land between Gloucester and Armagh streets earmarked for two new buildings but designated for the performing arts precinct; the Goodman Group, which had approval for a $350m precinct called Te Putahi by the Bridge of Remembrance but did not buy the land; Anthony Leighs, who had a plan for five City Mall buildings but instead sold his land to the Government, and Ganellen, which sold its Cathedral Square site, where the former The Press building sat, along with plans for a new building.
Many investors who are not keen on the development gamble have also sold land, with some sites changing hands more than once since the earthquakes.
Global construction forecaster Rider Levett Bucknall described Christchurch's construction costs as "rising rapidly", making the cost of building premium office space in the city the highest in New Zealand.
Property Council president Tony Sewell said that developers had varied appetites for risk and debt.
"You might be prepared to take more risk if you've got more money."
Success depended on the ability to find tenants and there were still too few prepared to pay the higher rents needed to rebuild the central city, Sewell said.
The Christchurch Central Development Unit's blueprint for the core retail area requires large, masterplanned precincts blending offices and shops around public spaces.
A spokesman for the unit said there was scope for small players in the core retail area if they collaborated with others to piece together the comprehensive developments required.
- © Fairfax NZ News
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