Singaporean govt's property-buying spree in NZ reaches $1.2b

Wynyard Quarter. Photo / Doug Sherring

The Singaporean Government's sovereign wealth fund is expanding its New Zealand property holdings after taking a 49 per cent stake in 10 major properties for about $1.2 billion in the last year.

Fletcher Building and Goodman Property Trust yesterday announced that Fletcher had struck a deal to sell a new Wynyard Quarter building, 80 per cent leased to Datacom, to the Singaporeans and Goodman, for $86.2 million.

The purchaser is Wynyard Precinct Holdings - 49 per cent owned by the Singapore state's Government Investment Corporation (GIC) and 51 per cent owned by Goodman.

GIC's founding chairman was former Singapore prime minister Lee Kuan Yew, who died this month, and profit from countries such as New Zealand is poured into government-funded research and development, education and social security.

The conditional Datacom deal sees the sale of the yet-to-be-built block on the corner of Gaunt and Daldy Sts behind the Caltex service station on Fanshawe St.

GIC has splashed out buying stakes in the biggest chain of malls throughout the country and some of the flashest new office blocks around the rapidly evolving Wynyard Quarter on Auckland's waterfront.

The Singaporeans are coming here because they perceive New Zealand to be one of the best places internationally to invest. GIC has holdings in around 40 countries and is one of the world's richest investment funds.

The Datacom building won't be finished until April 2017 and site works have only just begun.

Those close to the deal said the Singaporeans were attracted to the yields here as well as working closely with parties they trusted.

This latest deal follows others for GIC to buy other big holdings from Goodman.

GIC, with over US$100 billion of assets under management, bought 49 per cent of the Viaduct Quarter last year. That comprises Air New Zealand House, the new Fonterra development now being built by Fletcher Construction and the Viaduct Corporate Centre, containing the Vodafone, KPMG and Microsoft/HP buildings.

This latest Datacom deal follows on from those transactions.

The Singaporeans also now have big retail holdings.

In November, Scentre Group - which owns and manages New Zealand's biggest shopping mall chain branded Westfield - announced a joint venture with GIC for five shopping centres in New Zealand, three of which have developments planned.

GIC has so far spent about $220 million in deals with Goodman around the Wynyard Quarter and Viaduct, while the Scentre deal was for GIC to invest in four malls in Auckland and one in Christchurch which are collectively worth $2.1 billion.

Finance experts estimated GIC had now spent about $1.2 billion in New Zealand. Shane Solly of Harbour Asset Management said the property sector was in robust form.

Singapore splurge

Singapore's Government Investment Corporation owns 49% of:

• Yet-to-be-built Datacom building, Wynyard Quarter, Auckland.
• Air New Zealand House, Fanshawe St, Auckland.
• New Fonterra HQ, Fanshawe St, Auckland.
• Vodafone head office, Fanshawe St, Auckland.
• KPMG and Microsoft/HP buildings, Viaduct Harbour Ave, Auckland.
• Westfield Albany, Auckland.
• Westfield Manukau, Auckland.
• Westfield Newmarket, Auckland.
• Westfield Riccarton, Christchurch.
• Westfield St Lukes, Auckland.