Report from BusinessDesk
The University of Auckland has conditionally agreed to buy a 5.2 hectare property in Newmarket that Lion Breweries bought back from property developers two years ago, saying the site could meet its expansion needs for years to come.
The university estimates that to cope with its growth it needs to build or acquire additional space at a rate of 6,000 square metres a year “for the foreseeable future.” The institution plans to consolidate its academic activities at its city and Grafton campuses though these would only cope with 10-15 years of growth, vice-chancellor Stuart McCutcheon said in a statement.
No price was given in the lease and a spokeswoman for the university wasn’t immediately available. The site is owned by Great Northern Developments, which had planned a multi-use construction project including apartments. Great Northern was a venture between AMP Capital NZ and the Abu Dhabi Investment Authority
They had agreed to pay Lion $162 million for the site in 2007 before the global financial crisis dried up credit and had made an initial deposit of $50 million, National Business Review reported at the time. AMP Capital subsequently wrote off its share of the project.
“The Newmarket site provides a significant opportunity for the University to manage its growth requirements over the next 50 years,” McCutcheon said.
If the sale is finalised, the university plans to use the site for a mixed use campus, with teaching and research facilities, student accommodation and business development, it said.
The deal would also herald the closure of the Tāmaki Campus “in part or whole in order to rationalise its campus holdings both to help pay for, and maximise the benefits of, the new site,” McCutcheon said.
The university is doing due diligence on the site and a decision on whether to go unconditional will be made at the April 2013 meeting of the university’s council meeting.
Press Release – University of Auckland
The University of Auckland has entered into a conditional agreement to purchase the 5.2ha former Lion Breweries site in Newmarket, in what is potentially its most significant property acquisition in a generation.
If successful, the University will use the site as the basis for long-term development of a mixed use campus, with space for purpose-built teaching and research facilities, student accommodation, business development and other facilities. This strategic move will eventually see the University consolidate its activities at the City, Grafton and Newmarket campuses, benefiting city life and bringing in new commercial opportunities.
Vice-Chancellor Professor Stuart McCutcheon says the proposed site presents a major new opportunity which will be integral to the University’s growth strategy for the next 50 years. The Newmarket site offers long term growth potential close to the City and Grafton campuses.
“In the last eight years alone we have raised entry standards for our students, increased research performance, invested about $600m in campus development and grown our annual economic contribution to the City and nation by about $2.3 billion to $6 billion. In order to support and sustain our ambitious growth path, the University needs to build or acquire additional space at a rate of about 6000m² of gross floor area per annum for the foreseeable future. In 2008 we consulted widely on, and subsequently adopted, a plan to concentrate our academic activities on the City and Grafton Campuses. However, at 6,000 m² p.a. these two campuses can sustain only 10-15 years of growth.
“The Newmarket site provides a significant opportunity for the University to manage its growth requirements over the next 50 years. The site’s benefits include proximity to the City and Grafton campuses; the opportunity to integrate campus development; shared major transport routes with the City and Grafton campuses; and additional space for student accommodation and other facilities to name a few.”
Should the University proceed with the acquisition, it would need to exit the Tāmaki Campus in part or whole in order to rationalise its campus holdings both to help pay for, and maximize the benefits of, the new site.
Chancellor Roger France says the University Council is enthusiastic about the prospect of acquiring the Newmarket site. “This is a wonderful opportunity not only to secure the University’s growth path for the foreseeable future on a site close to the existing campuses, but also for the redevelopment of a site that is of critical importance to the City.”
The University is now conducting due diligence on the site and a decision on whether to go unconditional will be made at the April 2013 Council meeting, says Mr France.