210 Khyber Pass Road, Grafton
Five-level commercial office building; single-asset PIE its directors have resolved to wind up
A single-asset commercial-property PIE that its directors have resolved to wind up. The FY25 accounts are prepared on a non-going-concern basis: the main tenant (45.72% of the building) is not renewing, so the property will be 74.01% vacant from 1 January 2026; the ASB term loan ($3.72m) breached its interest-cover covenant (0.83× against a 1.50× minimum) and matures 30 October 2025; and JLL has marked the building down to $7.5m (from $8.7m a year earlier and $10.25m in FY23). The building still trades at a small operating profit — the $(1.06m) loss is the non-cash valuation writedown — so this is a forced sale of a cash-generative asset, not a failed one. Directors see "no realistic alternative other than to sell the property and wind-up the Company."
| FY24 | FY25 | |
|---|---|---|
| Investment property — JLL fair value | 8,700,000 | 7,500,000 |
| Rental income | 728,906 | 630,345 |
| Operating result before fair-value movement | 136,427 | 88,079 |
| Fair-value loss on investment property | (1,649,268) | (1,148,689) |
| Loss for the year | (1,512,841) | (1,060,610) |
| ASB term loan | 3,723,750 | 3,723,750 |
| Net assets (equity) | 5,071,277 | 3,976,237 |
| Accountant | Maat Consulting Limited (Manager; prepares the accounts) |
| Banker | ASB Bank |
| Auditor | Baker Tilly Staples Rodway Audit Limited (New Plymouth) |
| FY end | 31 March 2025 |
| Currency | NZ$ |
"Management has determined that the going concern basis of accounting is no longer appropriate... the Company has no realistic alternative other than to sell the property and wind-up the Company."
- Main tenant (45.72% of floor area) is not renewing; its lease expires 31 Dec 2025, leaving the building 74.01% vacant from 1 Jan 2026
- ASB term loan $3,723,750 expired 30 Apr 2025, extended only to 30 Oct 2025; covenants are LVR ≤55% and ICR ≥1.50× — the ICR fell to 0.83× at 30 Jun 2025 and remained in breach at sign-off
- On 14 Jul 2025 ASB advised it would take no action on the ICR breach "at this time" but reserves the right to act — the facility is callable on demand
- JLL fair value $7.5m (over 94% of total assets), down from $8.7m FY24 and $10.25m FY23; the valuer estimates a 9–12 month selling period
- B-share distributions cut to 0% in FY25 (FY24: part-year 9.2%); $112,500 of estimated selling costs already accrued
- Partial mitigation only: on 8 Jul 2025 a tenant occupying 14.52% confirmed a 3-year renewal from 30 Sep 2025 — far short of replacing the 45.72% departure
- Property "currently being actively marketed for sale" (Note 4)
- 2013–2014Company formed to buy 210 Khyber Pass Road; equity raised via 98 parcels of $50,000 (prospectus 24 Oct 2013).
- 31 Mar 2025JLL marks the building to $7.5m (from $8.7m); FY25 accounts adopt a non-going-concern basis.
- 30 Jun 2025ICR covenant calculation drops to 0.83× against a 1.50× minimum — Company in breach.
- 8 Jul 2025A tenant occupying 14.52% confirms a 3-year lease renewal from 30 Sep 2025 (partial mitigation).
- 14 Jul 2025ASB elects to take no action on the ICR breach "at this time", reserving its rights.
- 30 Jul 2025FY25 financial statements signed; Baker Tilly Emphasis of Matter on the non-going-concern basis.
- 30 Oct 2025Extended ASB loan maturity.
- 31 Dec 2025Main tenant (45.72%) lease expiry — building becomes 74.01% vacant from 1 Jan 2026.