Applicant
KVSI New Zealand Property Trust
Case number(s)
200810042
Decision date
Type
Decision
Decision number200810042
Application number200810017
Date15 May 2008
Offeror/applicantValad Commercial Management Limited as trustee for KVSI New Zealand Property Trust
Ultimate applicant beneficial ownership99.26 percent - Australia, Australian Public
0.64 percent - Various, Various overseas persons
0.1 percent - New Zealand, New Zealand Public
Beneficial overseas ownership 
- Asset current0 percent
- Asset proposed99.9 percent
- Share currentN/A
- Share proposedN/A
Offeree(s)/seller(s)Perron Group Limited
100 percent - New Zealand, Wilkies (Lawrence Ernest)
Business activitiesTransport & Storage - Storage
Details of land involved0.5665 hectares of freehold situated at 30 Hunters Park Drive, Three Kings, Auckland being CT 40260 (North Auckland Registry).
Regions involvedAuckland
Total consideration$13,750,000
Consent soughtTo acquire an interest in land which, either alone or together with any associated land, exceeds 0.4 hectares and adjoins land that is listed, or in a class listed, as a reserve, a public park, or other sensitive area by the regulator under section 37.
Rationale

The application has been approved as it met the criteria.

The Overseas Investment Office is satisfied that the individuals with control of the Applicant collectively have business experience and acumen relevant to the overseas investment, and that the Applicant has demonstrated financial commitment towards the overseas investment.

The Overseas Investment Office is further satisfied that each individual that exercises control over the Applicant is of good character and is not an individual of the kind referred to in section 7(1) of the Immigration Act 1987.

Background for the Investment:
The Valad Property Group (VPG) has acquired a number of self-storage sites throughout New Zealand as part of an ongoing joint venture arrangement with Kennards Group (Kennards). Typically VPG provides funds for the joint venture and Kennards provides expertise using its experience in the industry to improve operations and to re-brand the facility in Kennards' brand.

Outline of the Investment:
The land is currently used to operate a self-storage facility. KVSI (pursuant to a separate agreement) intends to purchase the current storage facility business on the land. Kennards, through Kennards Storage Management Pty Limited, will manage the storage facility. Consent to this transaction is not required as the consideration is less than $100 million.

Rationale for the Investment:

The self-storage market in New Zealand is highly fragmented with many small operations and only a handful of multi-site operators. The level of sophistication and professionalism within these operators is low and there is an opportunity for consolidation of some of the smaller operators and also to acquire some of the larger sites. The joint venture arrangement between VPG and Kennards means that through VPG's capital and Kennards expertise in self-storage they consider they can significantly improve the operation of the storage facility currently on the land and to improve financial performance.

The proposed overseas investment will or is likely to benefit New Zealand (or any part of it or group of New Zealanders) having regard to the following benefits:

Overseas Investment Act 2005:
s17(2)(a)(i) -Creation of new job opportunities.
s17(2)(a)(iii) -Added market competition and greater efficiency and productivity in the Applicant's business.

Overseas Investment Regulations 2005:
r28(b) -Key person in a key industry of a country with which New Zealand would benefit from improved relations.
r28(c)(i) -Adversely affect New Zealand's image overseas.
r28(e) -Previous investments beneficial to New Zealand.
r28(f) -The investment will give effect to a significant Government policy or strategy.
r28(g) -Enhance the viability of other overseas investments

ContactAndrew Petersen/Elena Chang
Bell Gully
PO Box 4199
AUCKLAND 1140