This prime, city fringe property, known as Orion House, was marketed nationally for sale and Oyster secured and purchased the competitively sought-after, multi-level office complex in March 2013.
With 4670m2 of net lettable area on a 3003m2 freehold site in a popular fringe CBD commercial area, the purchase was a tangible sign of Oyster’s ability to acquire high quality property, in a competitive environment, with due diligence conducted in a relatively short period of time.
Orion House was then structured, with bank funding, and launched as a proportionate ownership scheme, with high profile international software developer Orion Health leasing it back for a 15-year term with three rights of renewal of five years each.
Orion also wanted the ability to grow further on the site by adding two additional office floors to the building. This was structured into the scheme allowing further equity and bank funding to be raised at the appropriate time.
The offer closed early and oversubscribed, with investors attracted to the property’s superb location, quality of refurbishment, calibre of tenant and length of lease – all attributes which make for sound, long-term property investment.
It also represented a significant milestone in the commercial property investment market as the Orion House syndicate offer was the first in New Zealand since the expiry of the exemption to the Securities Act (Real Property Proportionate Ownership Schemes) Exemption Notice 2002, which related to commercial property syndication.
This legislative change was aimed at giving the investment public enhanced confidence, through a greater level of disclosure and compliance – including a registered prospectus, a deed of participation and a statutory supervisor to oversee the offering.