$250m Wellington development confirmed

The project is expected to be completed in the third quarter of 2025

$250m Wellington development confirmed

A $250 million development will soon rise in a piece of prime real estate in Wellington, after Precinct Properties New Zealand secured an unconditional agreement to acquire the site on 61 Molesworth St.

The site on 61 Molesworth St has sat empty since the Kaikōura earthquake and is currently being used as a car park after the previous building was demolished due to risk of collapse.

An 11-storey seismically resilient, environmentally focused commercial office building will be constructed on the site and will become home to the Ministry of Foreign Affairs and Trade (MFAT), which will occupy about 12,000 square metres of the new building and will lease the development’s commercial space, NZ Herald reported.

“In addition to the high-quality building specifications for this project, seismic resilience has been a critical consideration,” said Scott Pritchard, Precinct Properties chief executive. “The structural design of the building will incorporate advanced technologies, such as tuned fluid viscous dampers which provide performance that exceeds design code minimum standards. Securing this outstanding opportunity reinforces the strong office-occupier demand for high-quality buildings in strategic locations like the government precinct in Wellington.”

The 24,000-sqm development will also feature ground-floor amenities such as a lobby cafe, meeting suites, and end-of-trip facilities.

The project is expected to be completed in the third quarter of 2025.

MFAT said the lease of its current Wellington headquarters at 195 Lambton Quay will end in September 2025.

“The building owner will then carry out a substantial building refurbishment that will require MFAT to vacate the property,” it said. “Following a thorough and robust process to identify new premises, MFAT has signed a development agreement and 25-year lease with Precinct Properties for a new building at 61 Molesworth Street.”

Cabinet approved the decision.

Demolished after the 7.8 magnitude Kaikōura earthquake in 2016, the commercial building that was at 61 Molesworth St was owned by Prime Property Group, whose director Eyal Aharoni admitted to renting out the empty office block to house the homeless.

“The kitchen and cubicles were being used as bedrooms, the toilet was in a corridor through the fire exit, and the family was using a shower on the ground floor of the building,” according to the Ministry of Business Innovation and Employment’s (MBIE) compliance and investigations team manager at the time.

In June 2017, Prime Property Group was ordered by the Tenancy Tribunal to pay back $6,900 of rent, $600 in exemplary damages, and the $20 filing fee to tenants, NZ Herald reported.

“Regardless of the landlord’s intentions, charging $300 a week to live in an office space is unlawful. It is a prime example of taking advantage of someone who is in a vulnerable position,” MBIE said. “The exemplary damages cost reflects the extent of the health and safety risks faced by the tenants, and the fact that the landlord should have known better.”

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