Anne Gibson, Property Editor for New Zealand's Herald, has been writing about real estate since 1985 and is a skilled and knowledgeable journalist with deep insights into property as well as other businesses.
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Two years ago,Air NZ was due to move its world headquarters from Auckland's CBD to a new building at the airport, but it never happened. Herald property editor Anne Gibson explains
Staying: why didn’t Air NZ do what Greg Foran said back in 2022 and shift its world headquarters? Is a city lease extension imminent?
Why is that empty Takapuna apartment building called The Loxley? Such an odd name. The story behind it may surprise.
What are the four hottest categories in the property market right now?
It was the flight that never took off.
But no announcements were subsequently made about this grounding and few seem to have noticed the lack of movement.
Two years ago, Air New Zealand was due to move its world headquarters from Auckland’s CBD to what seemedlike a more sensible option: Auckland Airport.
Head office staff were to be at the coalface, with new digs in a leased block near the tarmac.
Yet that never happened.
Sometimes, the news is in the silence which few notice.
The reception area at Air NZ's refurbished Auckland Airport campus - was this ever built? The airline never moved its world headquarters to the airport.
Our national carrier has stayed put in its multi-level office block with naming rights, which it leased back in 2006.
When asked, chief financial officer Richard Thomson said: “After further assessment, and the airline’s current priorities, we decided to defer this until at least 2035.”
Air NZ chief financial officer Richard Thomson. Photo / Supplied
The koru-emblazoned flyer was to leave the Wynyard Quarter for Auckland Airport.
But four years after the business announced what seemed like an imminent shift, hundreds of staff remain put.
The airline is located at 185 Fanshawe St in the ever-expanding Wynyard Quarter, beside where Mansons TCLM last year finished $550m offices for telco One New Zealand.
One New Zealand is Air New Zealand's neighbour in the Wynyard Quarter. Photo / John Weekes
But that can’t be proven because neither party will confirm or deny that.
Air New Zealand chief executive Nikhil Ravishankar at the Iata AGM in Rio de Janeiro. Photo / John Weekes
However, a large tenant can’t occupy an office building without a lease, especially one of Air NZ’s significance, taking up many floors in the block.
“Yes! We’re still here,” a staffer confirmed.
So either the old lease is still operational, which seems likely, or a new one is being contemplated, which also seems possible given the lack of movement in the last few years and that the existing lease expires in 2027.
The Wynyard Quarter, where Air NZ has its HQs, is popular for recreation and in a waterfront location. Photo / Jason Dorday
The Herald reported in 2022 that the old lease was due to expire in 2027.
Back then, when Air NZ’s move was announced, Greg Foran was CEO.
He spoke about the intention to make that shift.
When he was Air NZ chief executive, Greg Foran announced the shift to the airport in 2022. It never happened. Photo: RNZ / Nate McKinnon
He said the solution was an “elegant” way of meeting twin aims - saving money and a cultural shift.
The company had an office staff of between 500 and 600 four years ago at its Fanshawe St headquarters.
Foran said it would move to a remodelled office building about 100m from the airport runway in 2024.
Staff were to be at the coalface, near the tarmac. Now, they're still in the city. Photo / Air NZ
The airline leased that building near its engineering hangars from Auckland Airport, he said then.
In 2022, Foran described the deal with the airport company as “an incredibly long lease and at very good rates”.
“Moving the city office to the airport will consolidate office space, significantly reducing the airline’s property footprint and reducing costs by 20% over 15 years. After design and construction phases, the move is likely to occur in 2024,” Foran said in April 2022.
That showed Air New Zealand’s remodelled headquarters located at 5 Geoffrey Roberts Rd in the airport precinct.
Back in 2022, new HQs images were released. This one showed how corporate staff would work closely with operational staff at Auckland Airport base. Image / Air New Zealand
Remodelling the existing airport campus at Geoffrey Roberts Rd was a multimillion-dollar job, and the search was on for tenants to take up the remainder of its lease at 185 Fanshawe St, Foran said in 2022.
Air New Zealand moved into Fanshawe St in 2006 just as growth was taking off. Photo / Alex Robertson
The airline never owned its offices on the Fanshawe St/Beaumont St corner opposite Victoria Park.
Years ago, it was on the corner of Quay St and Queen St in the building now owned by Precinct Properties.
When that NZX-listed landlord was doing the building up, it called it One Queen.
The Precinct building, once known as One Queen, opposite the Ferry Terminal. Air New Zealand was once here. Photo / Precinct Properties
In 2018, 185 Fanshawe St was part of a $635m portfolio sold by Goodman (51% owner) and partner Singaporean sovereign wealth fund GIC.
The buyer was the United States investor Blackstone.
The KPMG, Auckland Transport, Microsoft and HP, Fonterra Centre, Bayleys House, Datacom and Air New Zealand buildings were part of the deal for that $635m sale.
The Fonterra offices, Fanshawe St, were sold along with the Air NZ building. Photo / Michael Craig
In its 2022 annual report, Air NZ said: “The company’s values underpin the cultural behaviours required to make the full potential transformation a success, and the project to relocate the head office to the Auckland Airport base should better align the culture and ensure strong connections between operational and administrative activities”.
So does staying in town, divorced from the airport, result in a disconnection of cultures from the operational and administrative activities, one wonders?
Designed but never executed? In 2022, this image was released. It was shows the planned entrance to the new airport base at Geoffrey Roberts Rd. Image / Air New Zealand
Around 2017, Air NZ renewed its lease for 10 more years, taking it up to 2027.
Property records today show 185 Fanshawe St is owned by Wynyard Precinct No.1. That is owned by Blackstone Inc, the title shows.
Directors of the Wynyard company are Jon Matthew Ormond of Remuera, David Enright Ritchie of Castor Bay and Yixiao Lu of Hong Kong.
Head office staff won't take off after all. Photo . Getty Images
The Auckland Council values the HQs at $82.5m, of which $26m is the land.
The building near the Southern Motorway offramp is 10,564sq m on a third of a hectare.
Blackstone pays annual rates of $598,000 to the council.
One wonders if Air NZ had trouble getting new tenants to sublet its space, hitting the downturn around 2022.
If no one was going to pay to take the old building, the airport move could have been very expensive.
Why Loxley?
The 46-unit Loxley Apartments on 32-26 Tennyson Avenue, in Auckland’s Takapuna, has been as a build to rent investment. Photo / Supplied
Loxley, the 47-unit Takapuna apartments that were finished a year ago but never sold, featured in the Herald this month.
The name itself has a back story.
It was named after the Alfred Lord Tennyson poem, Locksley Hall.
“It’s a bit of a stretch, but it is on Tennyson Ave,” said one person who has had involvement with the unfortunate property.
The poem’s title and the apartment block’s name are pronounced the same but spelt differently.
Four hottest property categories
Director of Icon NZ Dan Bosher at 256 Queen St, Auckland, where the company is building student digs for Precinct. Photo / Annaleise Shortland
Four sectors are the hottest right now.
Student accommodation
Hotels
Industrial
Data centres (although Amazon didn’t go ahead in Auckland yet)
That’s the word on the street.
Forget offices. Forget housing. Forget retail.
It could be some years before these recover, industry insiders say.
Precinct’s direction says it all: two big student blocks rising: Stanley St by Haydn & Rollett and 256 Queen St by Icon Construction.
Haydn & Rollett is building a $960-million student accommodation tower at 22 Stanley St, Parnell, Auckland for Precinct Properties. Photo / Haydn & Rollett
Questions are now emerging about future trends and what may remain hot. People say industrial could be so busy that needs are met but student accommodation has a long way to go.
Anne Gibson has been the Herald’s property editor for 26 years, written books and covered property extensively here and overseas.
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