New Zealand’s Infratil has entered into unconditional sale contracts for three bus depots to property development and investment company Vantage
New Zealand’s Infratil has entered into unconditional sale contracts for three bus depots to property development and investment company Vantage Group.
The properties, in Wiri, Glenfield and Swanson, Auckland, are long-term operational bus depots for its subsidiary, New Zealand Bus. New Zealand Bus has 15-year leases in place for the three properties and the sale price reflects a blended yield of around 8.6 percent on current market rentals.
The sale price is $4.1 million or 21.6 percent over Infratil’s book value for these assets.
Infratil Chief Executive Marko Bogoievski says these assets have limited short to medium-term value appreciation potential given their long-term bus depot focus.
The sale proceeds will be used to reduce the debt levels of the company, which owns and operates assets across the energy, airport and public transport sectors. Its energy operations are predominantly in New Zealand and Australia. The company owns Wellington Airport, as well as others overseas.
Infratil’s public transport services (New Zealand Bus) are in Auckland and Wellington. It is the country’s largest public transport operator with more than 1,000 buses, seven depots and around 2,000 employees. It provided some 50-60 million trips a year.
It is believed that the company is planning to sell or redevelop other bus depots, turning them into residential estates.
The asset review is part of the divestment programme that is expected to realise between $125 million and $150 million in non-core asset sales by the end of this year.
The Killbirnie bus depot redevelopment in Wellington shows a mixed-use scheme with a residential focus for the 26,000-square-metre site.
According to Infratil executive Tim Brown, a resource consent application was expected to be filed in the second half of this year. The existing depot facilities were “way past their use by date”, he says.
Apparently, the large depot could be replaced with smaller sites around the city, to assist in coordinating the bus fleet.
Earlier this month New Zealand Bus sold its interests in Fuller Ferries to Souter Holdings.