SugarTree the catalyst for change, says project manager
SugarTree project manager Darren Brown said last night the $250 million apartment & mixed use development would be a catalyst to transform the area at the top of Nelson St. It should eventually get council help as well: One of the proposals in the Auckland Council’s Auckland Plan is for the one-way Nelson & Hobson Sts is to revert to 2-way traffic, which alone would tame the arterial roads off the motorways at Spaghetti Junction. SugarTree is already ahead of the 2 projects for the site before it, the first of them Jamie Peters’ acquisition of the 8072m² L-shaped site linking from 145 Nelson St, on the slip lane down from the motorways, round to 27 Union St at the pinnacle of the cbd’s Victoria Quarter. The second scheme for the site, revealed 5 years ago, was Brian Sutton’s leasehold integrated development, comprising 5 tower buildings (10-12 storeys above the podium, or 35m high), 2 commercial buildings (2 & 3 storeys) 2 parking levels & a podium level.
Mr Sutton’s planning was detailed, but that scheme ran into the global financial crisis. SugarTree, headed by local developer Wayne Allen (Nelson Union Ltd) with Chinese partner Lily Investment FTC Ltd in the Lily Nelson Union joint venture, is based on apartments – 160 in the first stage, 340 more in the following 2 stages – but is also intended to have large components of commercial & retail units to make the development a community. With the present divide of the Nelson St motorway offramp & its oneway traffic, SugarTree is likely to have less of a tie to the cbd and more of a link to the western fringe down to the ex-council depot property where Rhubarb Lane was the last development proposal, further down to Victoria Park Market, where redevelopment is under way, and the short distance to the Wynyard Quarter, being developed by both public & private interests.
But it’s also just a 10-minute walk into the heart of the cbd, a route now dotted with small retail & commercial premises after earlier apartments developed at the top of Nelson & Hobson Sts had no initial supporting infrastructure. Mr Allen sees 2 other aids to development. One is the change in council development levies from a percentage of land value (6%) to a fixed fee, which favours larger & more expensive units over “shoeboxes”. The other is his joint venture partner, a consortium of Shanghai-based investors who have been developing a residential subdivision at Flat Bush. Mr Allen said his partners had experience, challenged development ideas and were a refreshing influence. 2 members of the consortium, project director Yi Tiejun (beneath the sugartree) & Michael Long, joined Mr Brown (left) & Mr Allen last night in unveiling the project’s sugartree sculpture, a larger version of which is intended to be placed in the public courtyard. They were also in a position to be confident of starting work on the project in mid-2013, unlike smaller local developers who have been constrained by requirements for a high level of precommitments.
SugarTree’s apartments will be more spacious than has been the norm in Auckland cbd & fringe development – 16 units/floor including one studio of 40m², the rest a mix of one-bedroom units (45-65m², some with a study) & 2-bedroom units (75-80m²). They will initially be priced between $3-600,000. Mr Brown commented on the difference between this & many other developments: “I went into one the other day, 3 bedrooms, 43m². You attract low-quality tenants into that, plus a couple of tenants sleeping in the lounge as well. In contrast, we’re completely focused on owner-occupiers.” The development will also have 4000m² of commercial & retail space in 15 ground-floor units which will have a variety of configurations & sizes – 35-73m² - and including 8 live/work spaces which will have a residential unit above them. They will be marketed for lease or sale. Bayleys agent Millie Liang will head marketing of the commercial & retail units while Ray White City Apartments’ newly established special projects team, headed by Virgil Roberts, will focus on the residential units.
Ms Liang expects the due diligence process of potential buyers to take several months: “The brief from SugarTree’s management has been to secure upmarket retail operations which would support the residential population of the units above. Suitable retail tenants would include a gym or fitness studio, hairdresser, drycleaner, licensed food & beverage operation such as a café or wine bar, and a high-end boutique grocery store specialising in home-meal-replacement offerings.” “SugarTree’s planners & architectural designers have recognised that occupants in inner-city apartment blocks need a café or a wine bar to relax in away from their domestic environment. Or that those requiring a boutique commercial space for an internet-based business, for example, would prefer to have a place of work close to their place of residence.” The stage 1 commercial units have leasing price tags of $5-600 +gst/m² for larger sites and $6-700 + gst/m² for smaller sites.
Construction of stage 1 is scheduled to run from mid-2013 to the end of 2014, and the other 2 stages to follow on a rolling schedule through to completion at the end of 2016. Stage 2 will include a franchised childcare centre as an anchor tenant and an expansion of retail outlets to serve the growing residential population, cementing the precinct’s destination status. “The existing presence of food & beverage outlets or social amenities in an immediate 400m radius around SugarTree is quite sparse. This development will go some way to establishing a neighbourhood hospitality hub. “In addition to servicing the immediate SugarTree resident population, the retail outlets within the complex will also act as a magnet for workers in adjacent office blocks within that 400m catchment radius. The hub will fill a void which stretches from the SkyCity environs in the east to the Sale St-Victoria Park precinct in the west.”