September 7, 2011 State Highway 18 now joins to Upper Harbour Highway making the North Shore... 
September 1, 2011 New Zealand Retail Property Group Management Limited (NZRPG) the manager of retail assets... 
September 1, 2011 As the Westgate site continues to evolve, NZRPG is constantly seeking to ensure... New Zealand Retail Property Group Management Limited (NZRPG) the manager of retail assets in both Auckland and Tauranga has been instructed to undertake an ownership restructure of two of its flagship assets being the Westgate Shopping Centre in Auckland and Fraser Cove Shopping Centre in Tauranga a limited number of properties within each centre have been offered for sale to the public.
It is important prospective purchasers understand the rationale for the ownership structure created, the management contractual overlay, and the ongoing role of NZRPG within the Centres.
Westgate and Fraser Cove being predominantly open air retail centres have been subdivided into smaller lots to allow the opportunity for diverse ownership. The subdivision has created freehold titled lots with an easement structure providing for common carparking and right-of-ways. The freehold subdivision means that each lot created continues to enjoy the benefits of development potential without being interconnected with a range of other properties within the site. This title form provides the greatest security to an owner as it allows each property to be dealt with
unencumbered by the restrictions of other properties or owners.
Having created a freehold subdivision it is critical that a structure is put in place to ensure that the centres continue to be managed and developed on a comprehensive and cohesive basis. To this end each owner of a lot will enter into a management agreement with NZRPG and each lot will have attached to it a range of covenants which ensure that the manager can continue to operate the centre as it has always done. The documents provide for restrictions and limitations in terms of the ability of individual lot owners and/or tenants to utilise their property in a manner which departs from what is best for the centre overall. In this way the manager has the ability to continue to grow the assets and deliver on the centre’s potential.
The cost of managing and operating the centres is recovered from the tenants in accordance with their leases. It is in reality the businesses within the centres which fund the management and administration activities provided. Proactive management is a vital ingredient in making a shopping centre successful and competitive. Tenants understand this and are prepared to make the investment into an operational expenses budget to ensure they are part of a quality, modern retail environment. The management structures and other documents put in place, whilst offering significant upside to the property owners, are most important in that they guarantee that the tenants within the centres will continue to receive the level of service to which they have become accustomed and has provided for highly successful business environments.
The greatest security of cashflow an owner can have is a tenant with a successful and thriving business. The health and wellbeing of the businesses within the centres is the priority of the manager in this regard.
Both Westgate and Fraser Cove are the dominating retail locations within their respective catchments, and are genuine success stories for both the owners and their tenant partners. The properties have continued to show strong trade performance over the last 2-3 years despite the difficult economic times which have prevailed. The owners have continued to invest in the centres through new buildings, upgrades and refurbishments, and attracting new quality tenants. More telling though is the ongoing investments made by both new and existing tenants in fitouts and business growth generally. The objective of the structures put in place, is to allow the centres to continue to flourish.
The comprehensive management structure offered delivers a passive individual income stream without compromising long term growth prospects of either Centre.
This is an opportunity for investors to purchase a property within a catchment dominating sub regional shopping centre. Prospective owners will benefit from their investment being part of a comprehensive and proactively managed retail centre.
This opportunity to directly own property within an institutional grade retail centre under management is unprecedented in New Zealand. Participation in real estate holdings of this quality is usually only available indirectly through investment in listed property trusts. This investment offer is designed to deliver the benefits of direct property ownership enhanced by the critical mass of a large and well managed shopping environment. It is in effect a standalone property investment however with the added security and knowledge that it forms part of a proactively managed environment.
