Health NZ premises set investor pulses racing

The high-spec office complex housing heavyweight Crown agency Health New Zealand - Te Whatu Ora on a long-term lease is up for sale in central Christchurch.

Previously home to communications giant Spark, the three-level building on Walker Street, on the CBD fringe, was occupied four years ago by Health New Zealand, whose operations benefit from its high-speed data capability, proximity to Christchurch Hospital, and secure covered parking.

The current lease runs through to 2036 with renewal options extending to 2056.

The site generates an annual net rental return of $535,578 plus outgoings and GST, with built-in annual CPI rent increases, replaced by market rent reviews every five years.

Created to replace the country’s 20 district health boards, Health New Zealand plans and commissions health services and runs all hospitals nationwide. As of 2022, it was the country's largest employer with a workforce of 80,000, an estimated annual operating budget of $20 billion and an asset base of $24 billion.

The property at 16-20 Walker Street, Christchurch Central, is being offered for sale through Blair Young of Bayleys Canterbury.

It will be sold by deadline private treaty closing on Thursday 13 November, unless sold prior.

The approximately 1,842-square-metre building features an extensive high-quality fitout and a seismic rating of 80 percent of new building standard. It is underpinned by some 1,813 square metres of freehold land.

The site incorporates 42 car parks, including 23 secure parking spaces.

Young said the long lease and Crown-backed rental income, with built-in growth, made the property the epitome of a high-quality bottom drawer investment.

“Occupation by the biggest of all Crown employers adds further to this site’s credentials as what buyers will see as a genuine ‘trophy’ investment,” Young said.

The strategic central Christchurch location was another key selling point, he said.

The Walker Street site sits within the Central City Mixed Use zone under Christchurch’s district plan.

This zone generally permits buildings up to 32 metres high. It allows for existing uses, and other community, commercial and business activities, while supporting the City Centre Zone as the focus for retail, offices and commercial services.

“Benefited by excellent on-site parking, the site for sale enjoys high levels of surrounding amenity and handy access citywide via the one-way systems.

“The property and tenants reap rewards from being on the fringe of a reinvigorated city centre, which is gaining new life from extensive commercial redevelopment and game-changing city amenities such as the world-class Te Pae Christchurch Convention Centre and soon-to-open Te Kaha indoor stadium.

“This beating heart of the city is attracting strong demand from a wide range of commercial tenants, including leading corporates, government agencies, financial institutions and retail businesses,” Young said.