Hotel Grand Central to sell New Zealand commercial building for NZ$60m

HOTEL Grand Central is selling PwC Centre, a six-level commercial building in Christchurch, New Zealand for some NZ$60 million (S$54 million).

Details of the third-party buyer were not disclosed by the company.

PwC Centre was purchased by Hotel Grand Central for NZ$49 million in 2017. The property has a lettable area of 7,872 square metres (sq m) with 103 car park spaces. It is situated on freehold land, with a total land area of 3,750 sq m.

In a bourse filing on Friday evening, Hotel Grand Central noted that the buyer has declared the agreement unconditional, after carrying out its due diligence on the property on Oct 27, and paying a 1 per cent deposit of NZ$600,000 the next day.

The deal is expected to be completed on Nov 11.

Hotel Grand Central said the proposed transaction will allow it to realise its investment in the office building asset.

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The net sale proceeds after full repayment of the residual mortgage loan of NZ$17 million and payment of related transaction costs shall be placed into interest-bearing bank term deposits, the company said.

This is pending a decision by directors of the firm on future investment opportunities, Hotel Grand Central added.

Assuming that the proposed disposal had been completed on Dec 31, 2019 and there was no loss in the earnings contribution by PWC Centre for FY2019, Hotel Grand Central's earnings per share would increase to 4.77 Singapore cents after the deal, from 3.64 cents on a pro-forma basis. Meanwhile, its net asset per share would increase to S$1.87, from S$1.86 before the proposed transaction.

Hotel Grand Central shares closed flat at 92.5 Singapore cents on Friday, before this announcement.