Precinct Properties pauses Auckland waterfront office tower development

Precinct Properties has announced it will not proceed with the Te Pūmanawa Downtown West skyscraper project early next year as planned. The developer is pausing the redevelopment of the Auckland downtown carpark at 29 Customs Street West due to challenging market conditions. The project, which had received fast-track consent, was intended to include a 55-storey office tower and three levels of retail and hospitality.

The company cited renewed inflationary pressure, elevated long-term interest rates, a lower New Zealand dollar, and higher financing costs as reasons for the delay. These factors have reduced confidence in the development's value upon completion and increased the risk of construction cost blowouts. Precinct CEO Scott Pritchard stated, "We are disappointed that current market conditions do not support proceeding with the Downtown development".

Precinct will continue to operate the site as a car park, targeting a yield on cost of approximately 5%. While the company has delayed the 55-level office tower, it previously decided in August to axe the $500 million 45-level hotel and apartment portion of the project. The developer maintains that future development of the site remains an objective.

Auckland Mayor Wayne Brown described the decision as "probably a very sensible decision" to avoid having a half-built structure in the city. Infrastructure Minister Chris Bishop argued that the pause does not represent a failure of the fast-track consenting regime.

How it developed

• Fri 30 Oct, 1:22pmThe report includes reactions from Mayor Wayne Brown and Infrastructure Minister Chris Bishop, and notes the land was sold to Precinct by the council in December last year for $122 million.

Where reports differ

• One report describes the office tower as 227m tall, while others describe it as 55 storeys

Compiled from reports by NZ Herald, RNZ, 1News and The Post.