Daily ShareChat: AMP Office Trust

By Jenny Ruth

Thursday 9th September 2010

AMP NZ Office Trust (APT) is facing significant vacancies with Westpac moving out of its two Auckland premises in the PricewaterhouseCoopers building and all but half a floor of its Wellington space in the Vodaphone building in the year ending June 2012, says Buffy Gill, an analyst at Goldman Sachs JB Were.

ANZ is also expected to vacate the ANZ Centre in June 2013.

"We believe the big question for APT remains occupancy, namely how quickly it can lease up vacant space," Gill says.

"This task should not be underestimated, given our outlook for subdued demand."

Gill expects the empty IAG space at 151 Queen Street will be leased by March 2011 and the BNZ space in the State Insurance building will be largely filled when its lease expires in September 2011.

"We also assume 21 Queen Street leases up a further two floors by year end, four floors in each of 2012 and 2013 and the remainder in 2014/2015," she says.

"We expect most of the remaining large tenants to be retained (albeit at lower rentals) and small expiries in Wellington to be rolled, but half of the Auckland small expiries to remain vacant for 12 months."

Recommendation: Hold.

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