Mortgagee Sale

Laings ROL AD 14 01 Introduction 5 02 Executive Summary 7 Contents 03 Situation & Locality 9 04 Asset Overview 11 05 Financial Information 13 06 Sales Process 15 APPENDIX A1 Tenancy Schedule 16 A2 Legal Schedule 17

01 Information Memorandum 5 Introduction 14 lAINGS rOAD

14 Laings Road, Lower Hutt represents a positive acquisition opportunity in the heart of the Lower Hutt CBD. The location of this commercial asset offers prime visibility and positioning, with high traffic flows enabling business profile and exposure. Under instruction from Kiwibank Limited as first mortgagee, CBRE is pleased to offer the asset for sale by tender closing 4.00pm Wednesday 2nd October 2013. Salient attributes of the property include: ►►Very high profile location ►►Significant holding in Lower Hutt CBD ►►Good tenant mix with minimal vacancy ►►Efficient floor plates with good levels of natural light This information memorandum introduces the property and provides most details of the opportunity. Potential purchasers should satisfy themselves on all matters that would normally be considered first when making an investment of this type. For any further queries please contact the agents

Mark Hansen Investment Analyst +64 4 474 9844 +64 27 385 9818 [email protected]

John McKenzie Director, Private Client Group +64 4 474 9827 +64 21 444 586 [email protected] 6

02 Information Memorandum 7 Executive Summary 14 lAINGS rOAD

THE OFFERING Units 10-15 being Levels 1-3 plus associated ‘accessory units’ at 14 Laings Road, Lower Hutt, Wellington

Site Area 771sqm

Location Prominently situated on the corner of Laings Road and High Street and Queens Drive.

Net Lettable area 1,872sqm*

Tenancy Leased to various tenants with a weighted average remaining lease term of approximately 1 year by income.

Income $261,588 (gross)

Operating Expenses $87,727

Due Diligence Full details will be made available online upon the recipient agreeing to a confidentially agreement. To register for access please visit www.14laingsroad.cbreinvest.co.nz

Method of Sale For sale by tender closing 4.00pm Wednesday 2 October 2013

Rating Valuation $2,200,000 as assessed by the council in September 2010 Note that the council is in the process of reassessing the GV of the units as the GV of $2,200,000 includes two units (16 and 17) which are not included with this sale.

*approx 8

03 Information Memorandum 9 Situation & Locality 14 lAINGS rOAD

Location Surroundings The property is located in the heart of the Lower Hutt Central Having dual frontages to both High Street and Queens Business District, strategically positioned on Laings Road Drive the immediate vicinity is regarded as the most popular stretching from High Street through to Queens Drive. The part of the Lower Hutt retail strip with adjoining buildings property is easily accessible to both pedestrian & vehicular generally comprising low to medium rise office and retail traffic and all major public transport hubs. properties. Neighbouring tenants include Number One Shoe Warehouse and Briscoes & Rebel Sports stores. This area is recognised as the main ‘strip’ retail area of Lower Hutt where pedestrian counts are their highest and is in very close proximity to the Queens Gate Mall. Transport The Lower Hutt Central Business District is well provided for in terms of car parking with metered parking available on both sides of most streets supplemented by the managed Centre City car park building. The property is furthermore within close proximity to all major public transport stops catering for both North and South Bound Traffic by both Train and Bus carriage. 10

04 Information Memorandum 11 Asset Overview 14 lAINGS rOAD

The Building Earthquake Prone Buildings The unit comprises the three upper floors of the Centre The Building Act 2004 required Councils to adopt an City Plaza, a four level building providing a ground floor earthquake-prone buildings policy to ensure all earthquake- retail complex, with three levels of office floors above in prone buildings are strengthened to at least meet the total the units provide some 1,872 square metres of office minimum prescribed standard (or be demolished). accommodation. The building was constructed in the 1960s. In November 2011, Hutt City Council updated their Internally the office floors provide good quality, functional Earthquake Prone Buildings Policy. Under this policy building office accommodation sufficient for the small to medium stock within the city has been assessed within the past five sized tenants which currently reside in the property. The years which has identified earthquake-prone buildings. The efficient floor plates provide good levels of natural light and New Zealand Society of Earthquake Engineers (NZSEE) has split well to accommodate smaller tenants well. recommend that every effort be made to achieve a structural performance improvement to at least 67% NBS (new All levels are occupied as office space, with the first floor building standard), to promote public safety and minimise currently configured to provide six separate tenants, the potential damage to heritage structures. second level with seven tenancies and the top floor split into two tenancies. We recommend you obtain independent engineering advice regarding the likely earthquake prone classification of the Due to the property being located on the corner with three subject buildings and the impact (if any) of the Council’s street frontages, the levels enjoy great natural light and views Earthquake Prone Buildings Policy on this property. We note of downtown Lower Hutt. Generally the floors are carpeted that the subject property does appear on the latest Lower throughout apart from service areas which contain vinyl Hutt City Council Earthquake Risk/Prone Buildings List flooring. Plaster ceiling are generally provided throughout (February 2013). with surface mounted lighting.

The building is serviced by two lifts that provide access Site Particulars between the ground floor retail and the subject office floors. In summary, the subject unit provides good quality office Legal Description: See appendix II accommodation in the context of the Hutt Valley office Tenure: Stratum in Freehold market. The floor plate sizes are well suited to splitting to Land area: 771sqm* attract either larger tenants or a combination of smaller tenants. Floor area: 1,884sqm* Car parking: Nil

Legal Description * approx The complete legal descriptions have been included in Appendix II. Rateable Value The registered proprietor of the property is NZB Trustee Land value Company Limited (In Liquidation). $726,000 Improvement value $1,474,000 Full certificate of titles available in the due diligence website Total $2,200,000 Zoning As assessed by the council in September 2010 The property is zoned Central Commercial under the Hutt Note the council are in the process of re-assessing the City District Plan. GV of the units as the GV of $2,200,000 includes two Full details of can be found on huttcity.govt.nz units (16 & 17) which are not included with this sale. The council expect new rating valuations to be issued before November 2013. 12

05 Information Memorandum 13 Financial Information 14 lAINGS rOAD

Operating Expenses

Rates $22,761 Body Corporate $57,216 Other / Misc $7,750 Total $87,727

Financial Summary

Gross Income $261,588 (less) Operating Expenses ($87,727) Net Income $173,861 Plus potential income $71,442 from current vacancies Potential Net Income $245,303 (Fully Leased)

A comprehensive tenancy schedule, and outgoings detail is available in the due diligence website. Given the council is in the process of re-assessing the GV for the units, the rates expenses are expected to decrease once the two units (16 & 17) are separated from the GV on the property. 14

06 Information Memorandum 15 Sales Process 14 lAINGS rOAD

14 Laings Road, Lower Hutt is being offered for sale by For further information and/or to arrange an inspection, Kiwibank Limited as first mortgagee, closing 4.00pm please do not hesitate to contact: Wednesday 2nd October 2013. Mark Hansen These tenders (in the form prepared by the solicitors for the Investment Analyst motrgagee) should be delivered to the agents in a sealed +64 4 474 9844 envelope labelled ‘Tenders for 14 Laings Road, Lower Hutt’ +64 27 385 9818 at: [email protected] CBRE (Agency) Limited John McKenzie ASB Tower, Level 12 Director, Private Client Group 2 Hunter Street, Wellington +64 4 474 9827 Attn: Mark Hansen +64 21 444 586 [email protected] All inspections of the property by a purchaser and/or consultants are to be made by prior appointment and arranged through CBRE. DISCLAIMER (To be read in conjunction with the information memorandum (the Memorandum)) Comprehensive due diligence information is available at www.14laingsroad.cbreinvest.co.nz The Memorandum: (a) is in relation to the property situated at 14 Laings Road, Lower Hull that is comprised in Identifiers WN The information in this document is general in nature and 38A/905 to WN 38A/910 (inclusive) (the Property) and has is a guide only. It does not take into account your individual been prepared by CBRE Wellington (CBRE); circumstances. Before acting you should check the accuracy of the information and seek your own independent financial (b) is for use solely by parties interested in making an and legal advice. The information must not be relied upon to offer to purchase the Property; and make any investment decisions. The principal and its agent (c) does not purport to contain all information that a will not be liable for your failure to verify the information or prospective purchaser of the Property may require and, in all seek appropriate advice. cases, prospective purchasers must seek professional advice and/or conduct their investigations, analysis and verification of the information contained in the Memorandum. CBRE (Agency) Limited Licensed Real Estate Agent (REAA 2008) Neither CBRE nor Kiwibank Limited (the Bank), as first mortgagee of the Property and vendor under the particulars and conditions of sale for the Property, have independently verified any of the information in the Memorandum or any of the information that may be provided by the owner of the Property. Accordingly, neither CBRE nor the Bank: (a) makes any representation or warranty as to the accuracy or completeness of the information in the Memorandum or provided by the owner of the Property; or (b) shall have any liability for any statements, opinions information or matters (expressed or implied) arising out of, contained in or derived from, or for any omissions from or failure to correct any information in the Memorandum, or provided by the owner of the Property, or any other written or oral communications transmitted to any recipient of the Memorandum, or information provided by the owner of the Property, including the successful purchaser of the Property. 16 A1 Appendix One: Tenancy Schedule

14 Laings Road, Lower Hutt

Indicative Tenancy Schedule as at 30 August 2013

FloorFloorFloorTenant NLANLANLA LeaseLeaseLease LeaseLeaseLease LeaseLeaseLeaseOptions Market Rental Current Gross TermsTermsTerms Comm. ExpiryExpiryExpiry Contract Rent LeaseLeaseLease (m2)(m2)(m2)(Years) DateDateDate DateDateDate(Years) ($pa)($pa)($pa)($m2)($m2)($m2) ($pa)($pa)($pa)($m2)($m2)($m2) TypeTypeType

Office Component

101 Vacant 101.26 - $16,202.00 $160.00 $0.00 Gross 103 Vacant 109.62 - $17,540.00 $160.01 $0.00 Gross 104 Denure Care Services Limited 64.57 6.00 years 1-Jul-07 30-Jun-13 - $12,250.00 $189.72 $12,250.00 $189.72 Gross 106 Jenny Geelan 30.94 1.00 years 1-Aug-12 31-Jul-13 2x2 $4,950.00 $159.99 $4,420.00 $142.86 Gross 107 Jenny Geelan 26.01 1.00 years 1-Aug-12 31-Jul-13 2x2 $4,161.00 $159.98 $4,160.00 $159.94 Gross 108 ISP 284.93 3.00 years 1-Oct-09 30-Sep-12 1x3 $45,589.00 $160.00 $45,589.00 $160.00 Gross 201 Vacant 30.66 - $5,200.00 $169.60 $0.00 Gross 202 Seniornet Hutt City 78.97 3.00 years 15-Jun-12 14-Jun-15 1x3 $12,635.00 $160.00 $10,133.00 $128.31 Gross 203 Oasls Network Incorporated 158.96 3.00 years 14-Sep-12 13-Sep-15 1x2 $25,433.00 $160.00 $22,260.00 $140.04 Gross 204 Acme Building 37.16 2.00 years 1-Jun-13 31-May-15 2x2 $5,946.00 $160.01 $5,200.00 $139.94 Gross 205 Bureau Vorilas Limited 32.52 0.60 years 1-May-10 30-Apr-10 9x.6 $6,400.00 $196.80 $6,400.00 $196.80 Gross 208 The Community Trust of Wellington 261.69 3.00 years 1-Jul-09 30-Jun-12 - $41,903.00 $160.12 $36,665.00 $140.11 Gross 210 Standards & Monitoring Services 45.45 2.00 years 1-Aug-10 31-Jul-12 2x2 $7,500.00 $165.02 $7,500.00 $165.02 Gross 301 HV Orthodontic 287.63 1.00 years 1-Sep-12 31-Aug-13 1x3 $52,533.00 $182.64 $52,533.00 $182.64 Gross 304 J.D Beere Dental 320.88 3.00 years 1-Jun-12 31-May-15 1x3 $56,155.00 $175.00 $54,478.00 $169.78 Gross

Sundry Income

Naming Vacant 1.00 - $2,500.00

Signage Vacant 1.00 - $30,000.00

TotalsTotalsTotals

AreaAreaArea Rental NZD$ NLA m2 $psm$psm$psm Passing Contract Rental $261,588.00 1,871.25 $139.79 Plus Actual Recoverable Outgoings $0.00 -

Gross Contract Rental $261,588.00 Less Total Outgoings $87,727.00 Add Vacancy $71,442.00

Potential Net Contract Income $ 245,303.00

This tenancy schedule is purely for the purposes of a guide, purchasers must satisfy their own opinion of details stated within. Information Memorandum Appendix T A2 wo: LegalSchedule

14 lAINGS rOAD 17