Northland Region Colliers Essentials | 1H 2023 NORTHLAND REGION COLLIERS ESSENTIALS | 1H 2023

The demand for high-quality office accommodation in Whangārei has led to even tighter market conditions with low vacancy rates supporting the case for new development.The industrial sector has also experienced an extended period of elevated tenant demand, with leasing options becoming increasingly scarce. The demand for retail premises is mixed. While there is a significant shortage of large-format retail premises, vacancy rates within retail strip locations are trending upwards.

Thedemandfor high-quality accommodationin Whangareihas led to even tightermarketconditions. Low vacancy rates support thecasefor newdevelopment. The industrial sector hasalso experiencedanextendedperiod of elevated tenant demand,with leasingoptionsbecoming increasingly scarce.The demand forretail premises is mixed. While thereisa shortage of large-format retail premises,vacancy rates within retail striplocations aretrending upwards

Thedevelopmentsectorhas remained activedespite increases in interest rates anda cooling economy.Inthe year to March 2023, building consent issuance approved theconstruction of 41,000 sqmofnew commercial and industrial with the industrial sector accounting forapproximately 49%ofall consents issued.Major infrastructure projects will theregional economy, includingthe stage one of thenew regional hospital with abudgetof$759 million. Northport is proposing a expansion of its operation to include thedevelopmentofa modern, container terminal, covering approximately13hectares.The terminal would link directly to KiwiRail’s proposed MarsdenPoint spur

The development sector has remained active despite increases in interest rates and a cooling economy. In the year to March 2023, building consent issuance approved the construction of 41,000sq m of new commercial and industrial floorspace, with the industrial sector accounting for approximately 49 per cent of all consents issued. Major infrastructure projects will benefit the regional economy, including the confirmed stage one of the new regional hospital with a budget of $759 million. Northport is proposing a significant expansion of its operation to include the development of a modern, efficient container terminal, covering approximately 13ha. The terminal would link directly to KiwiRail’s proposed Marsden Point spur.

A shortage of industrial leasing options haspushed warehouse rental values up to an averageof$135per sqm in Q1 2023, from $130 in Q4 2022. Retail rentshave remained stablebut incentives have increased, particularly in secondary locations, wherevacancy rates have increased.Inthe sector, the to quality hasseen upward pressure applied to primegrade rentals

A shortage of industrial leasing options has pushed warehouse rental values up to an average of $135 per square metre in Q1 2023, from $130 in Q4 2022. Retail rents have remained stable but incentives have increased, particularly in secondary locations, where vacancy rates have increased. In the office sector, the flight to quality has seen upward pressure applied to prime grade rentals.

Commercial and industrial property salesactivity declined in 2022from therecord levels recorded in 2021, the impactuponinvestorsentimentof increasing interest rates andforecasts of recession. Despite this, transactions totalling $147.5 million were completedoverthe year led by theindustrial sector whichaccounted forapproximately 59% of total sales by value

Commercial and industrial property sales activity declined in 2022 from the record levels recorded in 2021, reflecting the impact upon investor sentiment of increasing interest rates and forecasts of recession. Despite this, transactions totalling $147.5 million were completed over the year led by the industrial sector which accounted for approximately 59 per cent of total sales by value.

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