Roxy-Pacific, Chip Eng Seng buy New Zealand office building for NZ$174m

PROPERTY groups Roxy-Pacific and Chip Eng Seng jointly said they have bought a Grade A office building in New Zealand for NZ$174 million (S$175 million). Each firm will own a 50 per cent interest.

The building, 205 Queen Street, comprises two commercial towers and a retail podium.

It has a lease term until June 2081, with a right of renewal for a further term of 98 years, until the year 2179.

It has a total site area of 3,764 sq m, net lettable area of 25,381 sq m, and is currently 96.37 per cent leased.

Roxy-Pacific executive chairman Teo Hong Lim said that the acquisition marks the firm's maiden entry into the New Zealand commercial market.

"We see an opportunity to capitalise on its upward trending market cycle. With favourable market indicators, we are optimistic to raise occupancy to 100 per cent in the near future so as to maximise rental yield," he said.

Chip Eng Seng executive chairman Raymond Chia said the property "comes with decent yield and is located at a prime location".

"Amid global and local challenging market conditions, we hope to diversify our operating risk while improving our recurring income," he said.

Roxy-Pacific last traded at S$0.515, down a cent. Chip Eng Seng last traded at S$0.73, down half a cent.