{"id":648251,"date":"2026-11-01T23:46:11","date_gmt":"2026-11-01T23:46:11","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/648251\/"},"modified":"2026-11-01T23:46:11","modified_gmt":"2026-11-01T23:46:11","slug":"precinct-properties-ceo-says-rising-interest-rates-ultimately-parked-1-5b-55-level-downtown-carpark-office-tower","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/648251\/","title":{"rendered":"Precinct Properties CEO says rising interest rates \u2018ultimately\u2019 parked $1.5b 55-level Downtown Carpark office tower"},"content":{"rendered":"

Pritchard cited the residential real estate equivalent as an example of how rising rates prompted valuation change.<\/p>\n

Anyone who owns a house when mortgage rates go down could see house prices rise, he said. <\/p>\n

Conversely, when mortgage rates go up, there could be downward pressure on house prices.<\/p>\n

\"DelayedDelayed – Precinct Properties’ plans for Pumanawa Downtown West: two towers on the Downtown Carpark site. This shows the two new towers to the right, with SkyTower on the far right.<\/p>\n

So it was precisely the same principles for commercial real estate, Pritchard said.<\/p>\n

With long-duration large-scale projects like the planned huge office tower, Precinct needed a stable economic environment.<\/p>\n

\u201cYet what we\u2019re seeing now is quite a lot of volatility and also the trajectory,\u201d he said of the outlook for interest rate volatility.<\/p>\n

In the past 12 months, there had been continued increases in interest rates.<\/p>\n

\"AA concept image of what could replace the earthquake-prone Downtown Carpark building. Image \/ Precinct Properties<\/p>\n

\u201cIt\u2019s hard to see them coming back, so that\u2019s really the key driver in this decision.\u201d<\/p>\n

Asked about the advantage of half the planned tower being pre-let, Pritchard described that as the silver lining.<\/p>\n

The company had been heavily encouraged by extremely strong tenant demand. <\/p>\n

It had four large organisations looking to pre-lease half the entire tower.<\/p>\n

\"PrecinctPrecinct still hopes to build the tower: Scott Pritchard discussed it today. Photo \/ Dean Purcell<\/p>\n

Demand for the planned tower was equivalent to Precinct\u2019s biggest tower in its portfolio, he said, referring to the PwC Tower.<\/a><\/p>\n

What that represented was strong economic growth.<\/p>\n

Pre-leasing had demonstrated high demand for Auckland\u2019s city centre.<\/p>\n

\u201cThat\u2019s the frustrating bit is that we haven\u2019t been able to convert on this occasion.\u201d<\/p>\n

\"InIn August, Precinct scaled the project back to only one tower: a new image of the planned 55-level building without the long-planned 45-level tower beside it. This is Precinct Properties’ amended plans for the Downtown Carpark site. On Friday, it parked that tower. Photo \/ Precinct Properties<\/p>\n

Tenants wanting to sign for the new tower would not have moved in for five years, but were recognising the benefit of having workers in high-quality offices, not working from home.<\/p>\n

Asked if the board or management delayed the tower, Pritchard said management worked with the board when making decisions of that scale.<\/p>\n

\u201cWe\u2019ve been working on this project for six years. We had resource consent, we had really good demand on the occupier side, we had fast-track.\u201d <\/p>\n

Ultimately, the company had to act in the best interests of shareholders and their capital. Precinct could not just commit to a project because it had made some progress. <\/p>\n

It could not develop a project that could be worth less in valuation than it cost to develop, he said.<\/p>\n

Anne Gibson<\/a> has been the Herald\u2019s property editor for 26 years, written books and covered property extensively here and overseas.<\/p>\n

Stay ahead with the latest market moves, corporate updates, and economic insights by subscribing to our Business newsletter<\/a> \u2013 your essential weekly round-up of all the business news you need.<\/p>\n","protected":false},"excerpt":{"rendered":"Pritchard cited the residential real estate equivalent as an example of how rising rates prompted valuation change. Anyone…\n","protected":false},"author":2,"featured_media":648252,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[23968,298285,286409,3952,8613,138,26665,3500,23783,12469,3180,111,139,69,6270,8143,26227,26346,56448,12064,1356,7676,801,312,1857,3159,46003,42580],"class_list":["post-648251","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-23968","tag-15b","tag-55level","tag-aucklands","tag-billion","tag-business","tag-carpark","tag-ceo","tag-downtown","tag-interest","tag-near","tag-new-zealand","tag-newzealand","tag-nz","tag-office","tag-park","tag-parked","tag-planned","tag-precinct","tag-prompted","tag-properties","tag-rates","tag-rising","tag-says","tag-site","tag-tower","tag-ultimately","tag-waterfront"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/648251","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=648251"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/648251\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/648252"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=648251"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=648251"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=648251"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}