Wellington's former Massey House for sale

The design of the office building at 126-136 Lambton Quay was ahead of its time. Photo / Supplied

A heritage office tower for sale in the Wellington CBD could enable investors to capitalise on the city's office shortage, or repurpose the space for apartment, hostel or hotel use.

The former Massey House at 126-136 Lambton Quay is being marketed by Colliers International's investment broker Michelle Chadwick and Wellington managing director Richard Findlay who are selling it by deadline private treaty closing at 4pm on Wednesday June 7.

The 943sq m freehold property has a net lettable area of about 7077sq m and Chadwick says its sale represents a chance to secure an award-winning, historic building in the capital's tightly-held 'Golden Mile' location.

"This is one of the largest redevelopment opportunities in Wellington, where prime retail space is scarce," she says.

Chadwick also points out that Wellington's prime office vacancy rate is at an all-time low of 1.2 per cent following last November's earthquake, which disrupted supply by reducing available office space by 7 per cent. The seismic rating for Massey House shows that it meets 45 per cent of the New Building Standards.

"So this is an excellent opportunity to refurbish and strengthen the property to fully capitalise on strong tenant demand."

Colliers International's research suggests Wellington's office market has swung heavily in favour of landlords, with rents expected to go up over the next 12 months, she adds.

As well as an office refurbishment, Chadwick says Massey House has significant potential to be redeveloped and seismically strengthened for apartments, short stay accommodation or hotel use.

"Tourism is booming in New Zealand, with a record number of visitor arrivals last year. That's good news for Wellington, which is the country's second biggest hotel market.

"However, only a small number of new hotels are planned for Wellington, leaving a gap in the supply pipeline. A boutique hotel in historic Massey House could help fill that gap."

"Wellington also has a shortage of student accommodation and, being close Victoria University, this property is ideally located for conversion into a student hostel," Chadwick says.

Completed in 1957, the property is listed by Heritage New Zealand as a Category 1 Historic Place, which means it is of special or outstanding historical or cultural significance.

Findlay says Massey House was architecturally significant as the first glass curtain-walled high rise office in New Zealand.

"The work of two important architects, Ernst Plischke and Cedric Firth, the building is internationally recognised for its aesthetic quality, and is considered an important local expression of modernism."

Massey House received a New Zealand Institute of Architects Enduring Architecture Award in 2008.

Findlay says the property comprises two connected office buildings with an integrated facade. Dual access is offered via Lambton Quay and The Terrace.

The larger building, at the north of the site, was completed in 1957. A smaller building to the south, designed by Firth alone, was completed a decade later.

The property spans 12 levels, including a mezzanine in the larger building, and two basements.

The ground level on Lambton Quay contains three retail units and a foyer which offers access to the upper office levels.

The street level on The Terrace (Level 3) contains another entrance foyer and four retail units, which have traditionally been leased to hospitality outlets.

Massey House was originally home to the offices of New Zealand's primary producers' boards. It was named in honour of William Massey, who established the boards while Prime Minister between 1912 and 1924.