Mirvac Hotels, developer and operator of the highly successful Quay West chain, has signed to operate the Watermark Plaza on Auckland’s Viaduct Basin. The $52 million project also sees Blue Star Group’s chief, Eric Watson, enter the commercial property scene as the developers’ financial backer.
Negotiations on the operation agreement for the 144 serviced apartments took several months. Meanwhile, that part of the development was split from the straight residential component of the Watermark project designed by Newport Pacific and headed by Robin Peel-Walker. Newport Pacific retains the 60-unit, five-level Watermark apartment project, where 25 units have been sold – with price tags from $155,000 to more than $1 million for two of them.
In the larger segment of the David Mitchell design which curls around the eastern end of the Viaduct Basin, 20 of the serviced apartments have been sold. They range from studios typically of about 50sq m (with 25 per cent width gain on most studios, 5.25m instead of 4m) at prices starting at $153,000, up to a 91 sq m apartment on the seventh floor above ground, priced at $540,000.
Promanco Kenman director Nigel McKenna, who is project manager for Krukziener Properties on the major Metropolis development under construction between High St and Kitchener St, has joined Greg Wilkinson of Axis Property Group to develop Watermark Plaza. He says it is only the second development where Mirvac has put its brand on the work of another developer.
The recently completed Coolangatta Plaza was the first. Buyers of the strata units opting to have their apartment run by Mirvac will sign for 10 years, with a 10-year right of renewal and the ability to extract themselves on six months’ notice after two years. They will be offered a two-year guaranteed net minimum return of 8 per cent, net of all costs other than interest and with any upside above 8 per cent shared equally by the strata owners and Mirvac.
The apartments are on a perpetual ground lease to Viaduct Harbour Holdings, renewable every 21 years with seven-year reviews. Work has started on the project, with demolition begun alongside the Loaded Hog bar, which will be moved to the premises beneath Kermadec restaurant. Construction should start in November, with completion at the end of next year.
Meanwhile, the first earthworks have begun on the Viaduct Basin office project along Fanshawe St, where a syndicate involving the Viaduct Harbour Boldings partners and Kiwi Income Property Trust will erect the first three buildings in a proposed seven-building lowrise office zone.
