International Property

New Zealand grants developer of Auckland tower exemption under anti-foreign buyer law

  • Hengyi, developers of The Pacifica, granted an exemption by New Zealand’s Overseas Investment Office, allowing them to sell to foreigners
PUBLISHED : Monday, 03 December, 2018, 7:03pm
UPDATED : Monday, 03 December, 2018, 7:03pm

Foreigners are allowed to buy units in the new 57-storey Pacifica project under construction in Auckland despite the government’s law change restricting non-citizens and non-residents’ purchase of property in New Zealand.

Gavin Lloyd, residential projects national director at sole marketing agents CBRE, said developers of The Pacifica had been granted an exemption by the Overseas Investment Office so they could sell to foreigners.

This was the first time the government had granted an exemption under the new anti-foreign buyer law, he said.

The government passed amendments to the Overseas Investment Act, meaning only New Zealand citizens or residents are now allowed to buy residential and lifestyle properties unless they get a specific exemption.

Multiunit flats of 20 or more units can be exempted, but Lloyd said The Pacifica’s developers Hengyi had to apply to qualify.

“You still needed to apply for an exemption from the minister,” Lloyd said.

The Overseas Investment Office exemption stated Hengyi was granted a transitional exemption certificate for large property development and it only applied to this particular project.

Lloyd said construction specialists Icon were up to level 15 of the tower, due to climb to 57 floors and be worth NZ$300 million (US$208 million) to NZ$400 million on completion by 2020.

“We have sold about 80 per cent of the apartments,” Lloyd said of the 282-unit project. Foreign buyers had only bought a few places there but the exemption was important, he said.

“It provides a high-level endorsement of the developer’s quality and its importance to the local economy. The decision by the OIO is an important step for The Pacifica and it is good to have official confirmation that foreign buyers are able to purchase. The process was a worthwhile one,” Lloyd said.

The exemption to sell to foreigners ran through till August 2023.