Investors willing to put money into Christchurch rebuild

Posted 03 Aug 2012 by Swiggs Popular
Posted in Business , CBD , Rebuild

Investors are signalling their willingness to put money into the rebuild of the Christchurch central city.


The Government has set up a unit within the Canterbury Earthquake Recovery Authority to help round up investment for use in the planned city structure, the blue-print of which was unveiled earlier this week.
The Government expects the private sector will be the biggest stakeholder in the rebuild of Christchurch.
Morrison & Co, whose flagship fund is Infratil, has signalled it will step up through its Public Infrastructure Partnership Fund.


Chief executive Marko Bogoievski says the fund is looking for opportunities to invest in education, health, and the tourism industry - particularly through convention centres - one of the anchor projects in the Government's plan.


He says the fund would look at a public private partnership model to establish a 20 to 30 year arrangement, whereby it would build and maintain a facility and then hand it back to the public.


Mr Bogoievski says at this stage the fund has in the vicinity of $200 million of equity, but debt can be added to that equity to create and fund more projects.


He says a fund doesn't want to be overexposed to one particular area or one particular part of of the country unnecessarily.


International commercial property consultants Colliers International says it's fielding calls from both local and national investors.


Hamish Doig of Colliers says the rental return has had a 1% growth per year over the last 20, which he describes as pedestrian.


He says investors are now seeing an opportunity and are committed to the city's rebuild.
Mr Doig says they have made a lot of money out of the earthquake because replacement value exceeds market values or indemnity values.


"They want to see, touch and feel their investments, they are 100% committed to being in Christchurch and they're looking for opportunities.


''Where they had $5 million of equity, they might have $15 million of equity now, where they might have had $10 million investments, they can actually have $30 million investments today".


Mr Doig says the Government's blueprint has successfully balanced supply and demand in the property market.


And he's been approached by international investors, from Australia and beyond.


Christchurch Central Development Unit investment manager James Hay says the recovery will be locally led, but international skill sets will be important.


He says the key message is to look at those people and entities that are looking for a long term commitment to the city and that they feel they can enter and exit the market in Canterbury and achieve their investment objectives.


The unit is set to launch an international investment marketing campaign in the fourth quarter of this year.

Discussion

Related Items

Central City Update Friday 28th November

Central City Update Friday 28th November

Thursday, 27 November 2014 3:28 p.m. by Transport4chch
Central City Update from Friday 28th November

Central City Update from Friday 28th November

Thursday, 27 November 2014 3:28 p.m. by Transport4chch