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Fonterra lease brings relief for Waltus

By Christine Nikiel

Friday 28th November 2003

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Fonterra's leasing of Auckland's KPMG Centre will bring a sigh of relief to the building owner, a syndicate of Waltus Prime Properties.

The deal, among the city's biggest lease deals this year, comes as major tenant KPMG Legal prepares to move to a waterfront site in May.

Fonterra will take on the 18-month balance of KPMG Legal's lease and then a six-year lease with six-year rights of renewal.

The building on Princes St, the fringe of Auckland's CBD, will house 600 Fonterra staff on nine floors.

Fonterra was tightlipped about the deal and Colliers International agent Paul Dyson, who brokered the deal, said details were confidential. But carparks for many of the 600 staff moving from eight locations around Auckland and Wellington will need to be found. The sign on the 13-year old building also advertises a fitout available.

The building was reported to have slipped in value from the $50 million it was sold for in 1997 to about $40 million.

A Fonterra spokesman said leases on the company's other offices expired soon and it made good economic sense to consolidate.

Fonterra chief executive Andrew Ferrier, said in a statement there would be cost savings of at least $1 million annually for Fonterra through consolidating existing leases, better utilisation of floor space and efficiencies created by centralising operations.

Fonterra leases two buildings at Auckland Airport, and office space at Parnell's Textile Centre, Dominion Rd, and Newmarket. Most of Fonterra's New Zealand staff are based at Auckland airport.

It's Wellington headquarters, the 18-level Pastoral House built in 1976 for the New Zealand Dairy Board, is for sale. Fonterra's lease there expires in December 2004.

Fonterra was considering building its own central office in Auckland, but the KPMG Centre was readily available.

Other major lease deals in Auckland this year include law firm Simpson Grierson's announcement it would take up 7600sq m in Manson Developments' new office building on Shortland St, and Vodafone's announcement it would take up 1200sq m in a purpose-built building on Auckland's waterfront, next to KPMG.

ANZ will take up 5250sq m in 107 Carlton Gore Rd, and EDS 5500sq m in the Smales Farm business centre on Auckland's North Shore.

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