Ex-office block converted into hotel QT Auckland sells to NZ Hotel Holdings

QT Auckland, sold to interests including the NZ Super Fund. Photo / Supplied

Auckland's ex-Bayleys House office building, converted into a hotel that opened last year, has been sold to an entity that includes the NZ Super Fund.

QT Auckland opened last November at 4 Viaduct Harbour Ave and has been bought by NZ Hotel Holdings owned by the NZ Super Fund, Russell Property Group and Lockwood Property Group.

Auckland Council values the property for rating purposes at $56 million. The building was bought by interests associated with the vendor.

The building is on Viaduct Harbour Holdings' leasehold land.

Dean Humphries, Colliers' national director of hotels, announced the sale.

He said the deal completed a busy year for the company which also bought the Sofitel Queenstown and has Rydges Wellington under contract.

"These hotel assets will join a world-class portfolio assembled by the partnership in just three years that already includes the 255 room Four Points by Sheraton and 160 room Adina Apartment Hotel in Auckland, 263 room BreakFree on Cashel in Christchurch, and the 203 room Holiday Inn Rotorua."

The hotel is in the Viaduct/ Wynyard Quarter area, has 150 rooms and is managed by Australasian hotel operators EVT.

The conversion was headed by Brett Russell, who owns one of New Zealand's largest commercial builders, Dominion Constructors.

The 20-year-old office block was previously Bayleys House.

The hotel has a restaurant and bar, Esther, headed by chef Sean Connolly.

It also has one of the city's only rooftop bars, Rooftop At QT, with views across the Viaduct, Wynyard Quarter and inner Waitematā Harbour, two conference areas, 70 car parks and a gym.

Humphries said the 140-room, five-star InterContinental Auckland now under construction in the ex-HSBC building, 1 Queen St would be the next major conversion to open in 2023.

Two years ago before Covid broke out, the NZ Super Fund said it was joining Russell and Lockwood to invest in tourism assets.

"The $42 billion NZ Super Fund is investing into a $300 million hotel portfolio established by the Russell Group and Lockwood Property Group, creating a platform for further investment in New Zealand's tourism sector," it announced on July 15, 2019.

The phased investment, which is subject to normal closing conditions, includes the Four Points by Sheraton and Adina Auckland Britomart in Auckland, the BreakFree Hotel in Christchurch, and an intention to acquire and develop additional sites.

NZ Super Fund's head of direct investments Will Goodwin said at the time that the fund had been considering opportunities to invest in New Zealand's tourism sector.

"This partnership will give the NZ Super Fund exposure to New Zealand's fast-growing tourism sector, diversify our investment portfolio and help support the industry's strategic objectives," Goodwin said in 2019.

"New Zealand needs additional hotel accommodation to support both growing domestic tourism and international arrivals. There are clear capacity constraints in this sector and we look forward to working with our partners to identify opportunities for future growth."