fbpx
HomeNEWSKiwi Property invests in Hamilton shopping centre The Base and seeks more

Kiwi Property invests in Hamilton shopping centre The Base and seeks more

Shopping centre giant Kiwi Property has spent $192.5 million to acquire a 50 percent stake in The Base at Te Rapa, Hamilton. Tainui Group Holdings Limited, an investing vehicle for the Waikato-Tainui tribe, controls the centre through a subsidiary named The Base Limited.

The ownership structure will be by way of a 50/50 joint venture with The Base Limited. Kiwi Property’s investment includes management of The Base and 120-year ground leases, but the underlying land will remain in tribal ownership. The deal also covers approximately 6.7 hectares of vacant land suitable for future development.

Tainui Group Holdings (TGH) has retained one hectare of the site, and secured an option over a further half hectare. It plans to build a Whanau Ora centre for family health there.

Kiwi Property chief executive Chris Gudgeon says: “This exciting acquisition will give our investors an ownership stake in New Zealand’s largest, single-site retail centre and aligns with our strategy of owning dominant regional shopping centres.”

Gudgeon says The Base has significant future development potential as its surrounding area is expected to account for the majority of New Zealand’s population growth over the next 20 years.

“As an investment proposition, The Base is an exciting opportunity with a positive retail sales outlook and strong underlying demographics.”

The Base has 183 retail stores and takes up 87,500 square metres. In the year to December 31 2015, it generated total retail sales of $262.8 million, an increase of 12 percent on the prior year. Kiwi Property is seeking to add value by actively managing the centre’s retail mix and pursuing unspecified “further value-adding opportunities.”

The sale of the 50 per cent stake is due to settle on 31 May 2016. In addition, Kiwi Property has made an offer to acquire the balance of The Base for a further $197.5 million in cash and shares – this will be reviewed by TGH and Waikato-Tainui in the next few weeks.

Tainui Group Holdings chief executive Chris Joblin says that due to the significance and materiality of this offer, the entity has passed it on to the tribe’s executive committee Te Arataura and the tribal Parliament Te Whakakitenga o Waikato, which will have the ultimate responsibility to decide what will happen.

Joblin says the partial sale of The Base is part of an effort by Waikato-Tainui to diversify its investments. It will use the proceeds to deduce debt and reinvest in a balanced range of investment classes, including land.

“We are proud of the achievements of Waikato-Tainui and TGH to develop and grow The Base and I’m sure that the involvement of Kiwi Property will see the centre continue its success under New Zealand ownership and allow TGH to take the next steps towards a balanced investment profile for Waikato-Tainui,” Joblin says.

Rahui Papa, chairman of the tribe’s executive committee Te Arataura, welcomed the partial sale.

“No tribal land will change hands. Waikato-Tainui ownership of the underlying land continues to be protected under Pootatau Te Wherowhero title. Kiwi Property, along with TGH will also protect unique cultural elements such as the pou [tribal markers], and bi-lingual signage,” Papa said. “At the end of the long-term lease, ownership of The Base shopping centre will return to Waikato-Tainui at no cost.”

Rate This Article: