Colliers Portfolio 2021 | Issue 3

Colliers Portfolio

Issue 3 2021

6-8 Taylors Road & 2-4 Gordon Road, Morningside, Auckland For Sale by Deadline Private Treaty

Accelerating Success 1

Welcome to Colliers Portfolio Issue 3 Welcome to the third Colliers Portfolio for 2021 - a selection of premium commercial and industrial opportunities from across New Zealand.

In this edition, find our latest collection of commercial properties throughout New Zealand, including sought-after, high-yielding industrial opportunities in South Auckland, mixed-use investments, and a unique heritage building for sale in Dunedin.

Whether you’re looking to invest, own and occupy, or develop, our national sales team has a range of options and looks forward to hearing from you.

Gareth Fraser Auckland Director | Investment Sales

Contents Recent Portfolio Sales 03 Front Cover Feature - 6-8 Taylors Road & 2-4 Gordon Road, Morningside 04 Featured Properties - Premium Listings 06 - Key Listings 09 Featured News & Research 14 Featured Brokers 17

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Recent Portfolio Sales SOLD

44 Arrenway Drive, Albany Sold by Shoneet Chand & Matt Prentice | Colliers North Shore

SOLD

SOLD

136 Whangaparaoa Road, Red Beach Sold by Shoneet Chand, Gareth Fraser & Jimmy O’Brien | Colliers Auckland CBD & North Shore

SOLD

1404 Omahu & 8 Chatham Road, Hastings 194 Great South Road, Papatoetoe Sold by Rob Nankervis | Colliers Hawke’s Bay Sold by Shoneet Chand, Matt Prentice & Matt Barnes | Colliers North Shore & Auckland South

SOLD

118 Carbine Road, Mount Wellington Sold by Ben Cockram & Hamish West | Colliers Auckland South

SOLD

105 Station Road, Otahuhu Sold by James Dickey & Ben Cockram | Colliers Auckland South

SOLD

92 Beachcroft Avenue Sold by David Burley, Hamish West, Gawan Bakshi & Ned Gow| Colliers Auckland CBD and South

SOLD

20-24 Stadium Drive, Pukekohe Sold by By Ash Vincent, Josh Franklin & Josh Coburn | Colliers Auckland South & West

SOLD

8 Te Pai Place, Henderson Sold by Josh Coburn, Amir Bashota, Dhiru Patel & Matt Prentice | Colliers Auckland CBD & West

SOLD

1452 Omahu Road, Hastings Sold by Rob Nankervis | Colliers Hawke’s Bay

SOLD

14/154 Harris Road, East Tamaki Sold by Josh Franklin, Greg Watson & Ash Vincent | Colliers Auckland South

SOLD

70-72 The Concourse, Henderson Sold by Josh Coburn, Greg Goldfinch & Dhiru Patel| Colliers Auckland West & South

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Front Cover Feature

Boundary lines are indicative only

Boundary lines are indicative only

New 10 year lease to Countdown Versatile Mixed-Use/Industrial Offering

The Best Opportunity in Morningside 6-8 Taylors Road & 2-4 Gordon Road, Morningside, Auckland For Sale by Deadline Private Treaty closing Thursday 15 July 2021 at 4pm (unless sold prior)

Combined land area totalling 2,554m2

2,011m2 total building area

Three separate titles in two offerings

Buy one or both to occupy, reposition or redevelop

Explore various redevelopment options

Extraordinary corner profile holding

This large corner holding at 6-8 Taylors Road & 2-4 Gordon Road presents is an extremely rare opportunity with versatile industrial improvements, split between three freehold titles (in two offerings), on mixed-use land, in popular Morningside.

The offering presents the opportunity to acquire two interconnected office/warehouses with a total building area of approximately 2,011sqm (approx. 1000m2 each) with a total land area of 2,554sqm; and a total of 21 carparks. This prime mixed-use corner boasts over 100m of road frontage displaying extensive profile & allows multiple redevelopment opportunities.

Morningside has experienced extensive re-gentrification and is rapidly becoming one of Auckland’s most loved and fashionable commercial and residential precincts. The suburb is located in a welcoming ‘sweet spot’ surrounded by Mount Eden, Kingsland and Mount Albert aligning itself to its extensive rezoning (to mixed-use) under the Auckland Unitary Plan. Call the sole agents for further information or to arrange a private inspection.

Jonathan Lynch 021 900 611

Hamish Paterson Matt Prentice 021 100 7259 021 464 904

colliers.co.nz/p-NZL67015221 4

Versatile Morningside sites a ‘peerless opportunity’ on Auckland’s CBD fringe 6-8 Taylors Road and 2-4 Gordon Road, Morningside, Auckland Two versatile industrial buildings on mixed-use land have been offered for sale with vacant possession in what is being marketed as a ‘peerless opportunity’ in Auckland’s CBD fringe.

The Morningside properties’ considerable long-term redevelopment potential is underpinned by their Business – Mixed Use zoning under the Auckland Unitary Plan, allowing a building height of up to 18m.

The adjacent freehold properties at the corner of Taylors and Gordon roads, Morningside, are on the market for the first time.

Matt Prentice, Industrial Sales and Leasing Director at Colliers, says this zone provides for residential development as well as a myriad of smaller-scale commercial activities ranging from offices, retail and supermarkets to food and beverage, visitor accommodation, entertainment, education and healthcare facilities, industrial laboratories and light manufacturing.

With a combined floor area of 2,011sq m on 2,554sq m of development-friendly land, and some 100m of road frontage, the real estate for sale is positioned within a fast-rising commercial and residential precinct.

Colliers has been exclusively appointed to market 6-8 Taylors Road and 2-4 Gordon Road, Morningside, Auckland, for sale together or separately. Sale will be by way of deadline private treaty closing at 4pm on Thursday 15 July, unless the properties are sold prior.

Jonathan Lynch, Industrial Associate Director at Colliers, says the building at 6-8 Taylors Road contains a warehouse of some 778sq m, ground-floor office amenities of 121sq m plus a 107sq m first-floor office. It sits on approximately 1,416sq m of freehold land with 11 car parks.

“The development and intensification opportunities presented by this zone are transforming parts of Auckland’s city fringe. In Morningside, it is helping to drive a wave of urban renewal which has made the suburb one of Auckland’s most loved and fashionable commercial and residential precincts.

“The area is seeing unprecedented development activity, including café and hospitality hubs, warehouse conversions to high-end offices, and new bulk retail operations,” says Prentice.

The approximately 1,138sq m of freehold land at 2-4 Gordon Road houses a building with a 780sq m warehouse, a ground-floor showroom and offices totalling 86sq m, and 79sq m of first-floor mezzanine storage, office and amenities. This property comes with 10 car parks.

Hamish Paterson, Capital Markets Broker at Colliers, says completed projects include the vibrant hospitality precinct in McDonald Street, a new trio of high-stud office/showrooms on Ethel Street, a development in Taylors Road incorporating Briscoes head office and Rebel Sport retail, and a nearby full-format Briscoes store.

“Industrial buildings of scale, anywhere in the CBD fringe, are scarcely available and rarely come to market – let alone two adjacent offerings of this size and quality going up for sale for the first time.

Also within walking distance of the sites for sale are key amenities such as Morningside Train Station, Westfield St Lukes shopping centre, the Kingsland retail and entertainment strip and Eden Park.

“Home in recent years to a New Zealand manufacturer of home shading systems, these sites will present buyers with an even rarer opportunity – to acquire them with vacant possession, allowing a new owner to make plans imminently.

“Nearby Morningside Drive offers easy access to the major arterial routes of New North Road and St Lukes Road.

“The options are numerous and will appeal to multiple buyer types, including owner-occupiers, add-value investors and developers. The possibilities are compounded by the ability to purchase either the entire 2,000-plus sq m of improvements or buy one of the buildings at about half this floor area,” says Lynch.

“About five minutes’ drive away are the St Lukes onramps to the Northwestern Motorway, providing connections to the Southern and Northern motorways, and through them to locations across the region,” says Paterson.

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Commercial/Residential For Sale

Heritage CBD Commercial / Residential Investment 63 Hanover Street, Dunedin For Sale at $1,750,000 plus GST (if any)

Site area 405m² (more or less)

Freehold tenure

Multi-tenanted investment

High profile location

NBS assessed at 85%

The subject property represents a unique opportunity to purchase a multi tenanted investment on Hanover Street, centrally located within the CBD of Dunedin City.

Built in 1880 (designed by famous architect E. M. Roach) as the Baptist Sunday School Building (Historic Place Category 2 Listed Building as per Heritage NZ), this earthquake strengthened historical building provides a commercial and residential mixed income CBD investment seldom seen on the market in recent times.

The property sits in a high profile location on Hanover Street, just off the Golden Block of George Street, Dunedin's main street, surrounded by a number of well recognised businesses including New World, Pacific Radiology, Kathmandu, Glassons, Hallensteins, Noel Leeming and McDonald's, and in close proximity to the current Dunedin Hospital, and the Meridian, Golden Centre and Wall Street Malls.

Tyler Dickison 027 222 1628

colliers.co.nz/p-NZL67015350 6

Investment For Sale

High Performing Investment with 15 Year Lease!

4155 Great North Road, Glen Eden, Auckland For Sale by Deadline Private Treaty closing at 4pm, Wednesday 28th July 2021 (unless sold prior)

Z Unitary Plan zoning Established 1,964m NZX Listed tenant 18 Year lease term ‘Mixed Housing Urban’ Auckland location Freehold title covenant from August 2018 + Z Energy Limited further rights of renewal Leased to ‘Z Energy Limited’ on an 18 year term (from Aug 2018), this outstanding investment is returning $315,172.79 pa net + GST & OPEX – 100% payable by the tenant. This ‘hands free’ passive investment also offers CPI rental growth and further rights of renewal, with a final lease expiry in 2053.

Annual net income $315,172.79 p.a. + GST & OPEX

Z Energy is a publicly listed company on the Australian & NZ stock exchanges with around 10,000 shareholders. The NZ Superannuation fund remains a 10% shareholder. They own and manage over 200 service stations and about 160 truck stops pipelines, terminals and bulk storage terminal infrastructure around the country.

Perfectly positioned in a popular development, featuring a long term lease to a market leading tenant, this is one of the most exciting investments currently on the market.

Shoneet Chand 021 400 765

Caroline Cornish 021 390 759

*Boundary lines indicative only

colliers.co.nz/p-NZL67015397 7

Boundary lines indicative only

Investment for Sale Premium Birkenhead Location – Calling Occupiers and Add Value Investors 22 Birkenhead Avenue, Birkenhead, Auckland For Sale by way of Auction, Thursday 22nd July 2021 at 2pm (unless sold prior)

372m² Freehold Site

Ten Carparks

Dual Access

Business Town Centre Zoning

Residential Conversion potential on first level

Holding Income

This well presented commercial property is one of the few remaining vacant buildings in the bustling Birkenhead Village. Cash in on Birkenhead’s growing prosperity and recognition as a desirable suburban location close to the City with all of the benefits of Shore side living.

The property consists of two levels, with great exposure to the main street on the ground floor and an opportunity to convert the top level into either separate residential or office accommodation. Generous parking for up to 10 vehicles is available in the rear yard with access from Mokoia Road. Holding income from the ATM Lobby is an additional benefit.

Owner Occupiers and add value investors alike will see the Business Town Centre zoning as conferring future development potential.

Tony Allsop 021 959 154

Jimmy O’Brien 021 979 001

Shoneet Chand 021 400 765

colliers.co.nz/p-NZL67015300

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Boundary lines are indicative only

Industrial for Sale

Rare Opportunity in Tightly Held Location 3 Rennie Drive, Māngere For Sale by Deadline Private Treaty closing 4pm Wed 7 July 2021 (unless sold prior)

NLA 1,792m² net lettable area

Ash Vincent 021 442 201

2,381m² freehold title

Tightly held location

Vacant possession

Recently refurbished

Mitch Broderson 021 166 7225

colliers.co.nz/p-NZL67015182

Boundary lines are indicative only

Vacant Industrial for Sale

Invest or Occupy in East Tamaki 24D Andromeda Crescent, East Tamaki Auction to be held 11am Wed 21 July 2021 at Level 1, Colliers House, 52 Highbrook Drive, East Tamaki (unless sold prior)

Z 593m² net lettable area

Greg Watson 021 083 13534

Three roller doors

James Dickey 021 026 81093

Newly refurbished new roof

Vacant possession

Light Industry zoning

Josh Franklin 021 990 714

colliers.co.nz/p-NZL67015266 9

Mixed-Use Commercial Investment

Split-Risk, Add-Value, 7 Tenancies 527 Blockhouse Bay, Blockhouse Bay, Auckland For Sale by Auction to be held Wednesday 14 July 2021 at 11am (unless sold prior)

Returning c.$72,476 net p.a. + GST (excl vacancy)

Ned Gow 021 122 2731

Tightly held Town Centre location

Split-Risk with seven tenancies

Add-Value potential with flexible lease terms

Opportunity for Owner-Occupiers and Investors

Gawan Bakshi 021 31 31 48

colliers.co.nz/p-NZL67015312

NATIONAL TENANT

A Grade Passive Investment Opportunity 160 Bairds Road, Otara Auction to be held Wed, 21st July 2021 at 11.00am at 52 Highbrook Drive, East Tamaki (unless sold prior)

Net rental of $165,000 + GST per annum

Matthew Barnes 021 828 563

National tenant

Long term lease 15 year initial term

Tony Marsh 021 141 2072

2,004m² freehold title

High profile corner site

Fixed annual rental increases

Shoneet Chand 021 400 765

colliers.co.nz/p-NZL67014278

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Boundary lines are indicative only

Industrial for Sale

Heavy Industry Zoning with Options Galore 52 Spartan Road, Takanini For Sale by Deadline Private Treaty closing 4pm Wed 14 July 2021 (unless sold prior)

NLA 6,940m² NLA over two buildings

Greg Goldfinch 021 537 682

14,451m² freehold level site

Paul Higgins 021 549 226

Returning $905,449 net p.a. + GST

Develop, occupy or invest

Favourable lease terms

Josh Franklin 021 990 714

colliers.co.nz/p-NZL67015237

SOLD

Boundary lines are indicative only

Industrial for Sale

Premium Airport Investment Offering 74 Richard Pearse Drive, Auckland Airport For Sale by Deadline Private Treaty closing 12pm Wed 7 July 2021 (unless sold prior)

ASX Returning $432,938 net p.a. + GST

Brad Johnston 021 409 553

Six years from 1 March 2019

ASX listed tenant

6 month bank guarantee

5,416m² freehold site

Paul Jarvie 021 337 419

colliers.co.nz/p-NZL67015205 11

Industrial Property

Simply the Best in Penrose 33 Fairfax Avenue, Penrose For Sale by Auction to be held 11am, Wed 14 July 2021 at Level 23, 188 Quay Street (unless sold prior)

Z Ideal warehouse - office ratio

Suitable for occupiers or investors

Ben Cockram +64 21 245 5855

680m² net lettable area

1,050m² freehold title

Secure yard

Zoned light industry

Hamish West +64 21 882 737

colliers.co.nz/p-NZL67015311

Boundary lines are indicative only

Industrial for Sale

Great South Road Gold - Prime Industrial Land with Income 1000-1008 Great South Road, Penrose For Sale by Deadline Private Treaty closing 4pm Wed 21 July 2021 (unless sold prior)

Z 7,131m² freehold site

Hamish West 021 882 737

Heavy Industry zone

Ben Herlihy 021 406 079

82m wide road frontage

Sealed and secure site

Returning $176,400 net p.a. + GST

Paul Higgins 021 549 226

colliers.co.nz/p-NZL67015403 12

Investment For Sale

NZX Listed Tenant in Popular Location!

3/ 75 Porana Road, Wairau Valley, Auckland Asking 6% Yield - $6,500,000 + GST (if any)

Returning $390,008 pa net + GST & OPEX

Shoneet Chand 021 400 765

1,883 sqm Nett Lettable Area

Minimum 2.5% annual rental increases

Matt Prentice 021 464 904

Excellent car parking across the development

Sole Agency

*Boundary lines indicative only

colliers.co.nz/p-NZL67015207

Office Lease 2021 Magazine launching soon

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Featured News & Research New Zealand Research Report June 2021 Snippets Commercial and industrial investment property returns have surged to multi-year highs, according to the latest data release from MSCI. Record low interest rates have escalated the competition for higher yielding property assets leading to yield compression, lifting values and, in turn, total returns.

The latest data shows that total returns across the ‘all property’ category over the year to March 2021 reached 15.9%, the highest figure recorded since December 2007. The result was primarily driven by capital appreciation of 9.8%.

Safe haven assets lead the way Sectoral differences in total return figures highlight the strong preference that investors have shown for assets with more defensive characteristics when economic uncertainty and volatility is apparent.

Industrial and Large Format Retail (LFR) are at the top of the list, but heavily contested.

Industrial – continues its strong run Strong demand and supply fundamentals underpin the industrial property sector. Competition for industrial assets from a range of buyers, such as high net worth individuals, syndicators and listed property companies has seen property values surge, lifting total returns to 21.8% over the year to March 2021, the highest total recorded since the inception of MSCI’s industrial index in 1994.

Large Format Retail – sees record returns The other standout performer over the year has been the LFR sector. Sharing many of the industrial sector’s defensive fundamentals, its appeal has been further bolstered by a significant increase in consumer spending which is underpinning tenant demand. The solid fundamentals have again attracted high levels of interest from a wide range of investors driving up capital values. Over the year to March, the sector has generated total returns of 22.4%, the highest recorded by MSCI. Shopping Centres and Strip retail – facing headwinds The MSCI data shows shopping centre capital values declined by 5.1% over the year, resulting in total returns sitting at 1.8%. The lower returns recorded reflect the different trading environment in which the retail sub-sectors are operating. While returns are lower

than other sectors at present, the result is an improvement for the sector with the rate of value decline slowing and total returns turning positive for the first time since June 2019. This suggests that investors see value in the sector, particularly for centres where future prospects are improving due to the economic recovery.

Office – sentiment improving Office returns have lifted over recent months registering total annual returns of 13.0% over the year to March 2021, up from 6.6% a year ago. The result provides a strong indication that investors have looked through the short-term disruption to the office market due to COVID-19 enforced changes in work practices.

Stride Property Group’s purchase of 46 Sale Street, Auckland CBD, for $152 million, equating to an initial yield of 5.2%, is a clear illustration of the confidence that the investment sector retains in the office sector, particularly for well located, high quality assets benefitting from strong tenant covenants.

Listed property valuations repeat the theme Property valuation gains have been a recurring theme within annual reports issued by listed property companies with March-year ends. Once again, however, portfolios with a heavy weighting towards defensive assets have seen the most substantial increases over the year.

Goodman Property has seen the largest increase, 17.3%, reflecting the high proportion of industrial property within its portfolio. Investore which invests exclusively within the LFR sector, saw a valuation lift of 15.5% over the year.

Office An increased focus on sustainability from both public and private sector office occupiers has seen demand for premises with certified green credentials lifting over recent years.

From 1st January 2021 all government agencies were mandated to ensure, when entering or renewing a lease collectively or individually and occupies 2,000 sqm or more and more than 25% of the building NLA, that the subject property has a minimum 4-star energy efficiency rating (5-star for new-build). Eke Panuku’s recent decision requires new commercial buildings to meet 5-star Green Star ratings for all new commercial buildings over 1000 sqm in town centres.

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The influence which the sustainable development trend is having on the office market is illustrated in the latest Colliers’ Auckland CBD office vacancy survey. While overall prime grade vacancy at December 2020 stood at 6.8%, vacancy within Green Star rated buildings was just 3.8%.

The development sector is also responding to the shift, adding just under 50,000 sqm of Green Star rated buildings to the Auckland CBD’s inventory over the course of 2020.

Industrial Despite the disruption caused by COVID-19 enforced lockdowns, industrial development ramped up over the year to April 2021. Building consent approval was issued for 1,143,696 sqm of new industrial development across the country, up 16.6% on the total recorded a year prior, according to Stats NZ. Building consent approval increased in 11 of 16 regions led by Manawatu-Whanganui where the total floor area consented rose by 329%. In the Bay of Plenty issuance rose by 102% to 135,816 sqm, a figure which has been surpassed once since 1991. South Island consents were up by 14.1% to 291,600 sqm with Canterbury accounting for 59.6% of the total.

Retail The March 2021 quarter showed more promising signs for the retail sector. The total value of retail sales increased by $648 million between the December 2020 and March 2021 quarters, with 10 of the 13 core industries recording greater sales values than the previous quarter. Sales volumes bounced back from a fall in the previous quarter with a total increase of 5.5% across the core industries.

When assessing the performance of retail within industries, the hardware, building and garden supplies industry was a standout with a total dollar value increase in sales of $144 million, the largest amongst core retail industries.

Looking at results across the country, 10 of the 16 regions had increased sales values compared to the previous quarter. Canterbury recorded the largest increase (2.3%), followed by Auckland and Waikato.

Find out more in the latest New Zealand Research Report at colliers.co.nz/research.

Asia Pacific Market Snapshot Q1 2021 Snippets Overview Across the Asia Pacific region, property markets started the year on a strong note, with office, industrial and logistics assets driving the ongoing recovery.

In China, the busy first quarter saw end-users and investors, including foreign investors, closing major deals in key cities. There was a resurgence in investor interest in Hong Kong and Singapore, while Japan witnessed the completion of a number of commercial and residential transactions.

In Korea, low interest rates and liquidity continued to fuel demand for office space, a trend likely to persist as competition intensifies for a shrinking pool of assets, while Taiwan saw demand spike for commercial properties.

In Australia, a typically quiet quarter witnessed heightened activity in the office segment, while New Zealand’s property market, buoyed by policy changes, low interest rates and expectations of reopened borders, is gearing up for an active year.

In the region’s emerging markets, India saw healthy demand for residential and commercial assets, and investors remain bullish about the market’s medium to long-term prospects. Vietnam’s property sector is in the midst of a rebound supported by government reforms, while Indonesia’s property market is benefiting from a smooth rollout of vaccines and policy changes that should strengthen purchasing power, improve market confidence and encourage investment. Thailand is also witnessing higher levels of market activity, especially in the logistics, warehousing and industrial sectors, but a rebound in the hospitality sector will depend on the resumption of international travel.

In the Philippines, where the economy shrunk last year for the first time since 1998, the property market is

Colliers NZ’s team of market-leading researchers regularly deliver comprehensive reports, forecasts and advice to empower property occupiers, owners and investors to maximise the potential of property and accelerate their success.

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Featured News & Research Asia Pacific Market Snapshot Q1 2021 Snippets - continued likely to pick up following the easing of quarantine restrictions and the deployment of vaccines.

Meanwhile, in Myanmar, the ongoing political turmoil will affect the near-term outlook, but the market is expected to retain its long-term growth potential, especially in the infrastructure and industrial segments.

Investors, end-users propel Chinese property market Several transactions were closed in Q1 by end-users as well as domestic and foreign investors, encouraged

by China’s economic recovery. Beijing saw more deals finalised in Q1 than in all of H2 2020, with more expected to close in the coming months. In Shanghai, where 11 deals were completed, end-users were active in the office sector while investors were keen on business parks. Chengdu and Xi’an performed well with eight deals finalised between them, and interest in office and retail properties is likely to remain high.

Industrial and logistics assets continue to stand out in Shenzhen and Guangzhou.

An industrial-sized recovery in Hong Kong Hong Kong’s property market extended its rebound in Q1, led by investor interest in industrial assets.

Investors looking to capitalise on local demand will focus on defensive assets while those seeking long-term income will turn to subsectors such as logistics, cold storage facilities and data centres. In the residential segment, resilient prices and strong pent-up demand for small to mid-sized units are prompting developers to consider acquiring sites for new projects, as well as collective sales of old tenement blocks for redevelopment.

Japan property market sees sustained investor interest Cross-border investors with a presence in Japan completed a number of deals across the logistics, residential and office sectors, despite a renewed state of emergency in major metro areas that dampened demand, especially in the hospitality sector. With investments in Japanese real estate showing few signs of slowing, fresh capital is expected to pursue logistics and residential opportunities in the coming months, as well as office assets at a more modest rate, particularly in major cities beyond the Greater Tokyo region.

Liquidity-fueled office property boom continues in Korea Transaction volumes and unit prices rose in tandem in Korea’s commercial property market, which continues to be propped up by low interest rates and ample liquidity. As border restrictions limit outbound investments, interest in domestic office space will remain high. Coupled with shrinking supply, this will drive top-quality asset prices even higher and push down cap rates. Interest from domestic as well as foreign investors is expected to spill over into logistics, hiking prices and depressing yields in the segment.

Industrial assets aid Singapore rebound Amid optimism about the resumption of normal business activities, investors and private funds continued to acquire industrial properties. The Boustead Industrial Fund launch underlined the segment’s importance to the city-state’s property market, which also saw deals close in the commercial segment while activity in the residential sector accelerated further. With business sentiment steadily improving following vaccine rollouts, local and foreign investor interest in commercial and industrial properties is expected to grow, with retail leading the way.

Office segment drives revival in Australia The office segment led the revitalisation of key Australian property markets in Q1. Sydney CBD occupancy rates rose to their highest level in 12 months as a growing number of workers returned to the office a trend also seen in Melbourne as the Victorian government lifted restrictions on staff coming in to work. In Brisbane, the CBD office market outperformed all others nationwide last year with the lowest percentage increase in vacancies. A combination of factors, including a public sector-led return-to-office strategy, improving market sentiment and limited asset supply, will pave the way for an even more active Q2 and beyond in these markets.

Auckland Investor sentiment is improving, buoyed by the start of New Zealand’s vaccine rollout and the prospect of a gradual reopening of the border. This, in concert with the low interest rate environment, has further bolstered demand for commercial property assets.

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Review

Forecast

There is a growing view amongst investors that the worst of the market disruption caused by COVID-19 has now passed. Locally, the situation continues to be well managed. With global vaccine rollout gathering momentum, there is increased optimism and anticipation of a return to relatively normal market conditions and investors are turning their attention to longer-term fundamentals. This has bolstered demand for safe haven assets, particularly industrial and bulk retail properties, both of which are witnessing strong tenant demand. Recent industrial vacancy surveys show market conditions have remained extremely tight, bolstering the view that vacancy is at, or close to, its cyclical peak. Confidence in the office sector is recovering, buoyed by improving demand and supply dynamics with confirmed tenant demand for space within new projects underpinning development activity.

A continuation of the low interest rate environment over the year ahead will sustain interest in higher yielding commercial property assets. Demand is likely to be further enhanced by recent changes to legislation, which makes residential property investment less attractive. Syndicated property offerings and assets with a value of up to NZD2 million, approximately 80% of the NZ market, are likely to see the greatest lift in demand as a result. The relaxation of border restrictions will result in a rebound in overseas investor activity, which has been hampered over the last year by the inability to inspect property. The prospect of increased competition emerging over the year ahead will incentivise local investors to seriously consider opportunities that arise in the short term.

View the full Asia Pacific Market Snapshot for Q1 2021 at colliers.co.nz.

Featured Brokers About Caroline is a member of the West Auckland Sales and Leasing Team. She specialises in the acquisition and disposal of office, retail, industrial and land assets.

Caroline Cornish

Caroline started her career as a Chartered Surveyor in London and moved to New Zealand in 1998, she HAS worked in the Colliers Industrial team specialising in sales and leasing for 14 years - during this time Caroline was one of Colliers top performers in the Industrial sector. In 2011, she took a step away from brokerage to spend more time with her young family.

Broker Auckland West Caroline returned to Colliers in 2018 in the West Auckland office, close to Mobile: 021 390 759 the local area where she lives. Now specialising in leasing and sales in the caroline.cornish@colliers.com area, she has transacted numerous deals in all sectors.

Achievements

Listings featured in this Portfolio - 4155 Great North Road, Glen Eden

$99m of sales in 3 years

110 deals in 3 years

16,600 sqm leased

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Featured Brokers About Senior expertise in Commercial Property Sales and Leasing. Completed over $500million+ worth of sales transactions since joining Colliers in early 2010 with a focus on investment properties, mixed-use developments, redevelopment sites comprising under-utilised improvements, land sales and office, retail and warehouse leasing.

Jonathan Lynch Associate Director | Investment Sales Auckland CBD Mobile: 021 900 611 jonathan.lynch@colliers.com

BBS Degree (Massey University) majoring in Real Estate followed by 10 years of business development experience in the FMCG sector in Ireland & New Zealand while conjointly playing rugby in Ireland. Previous role as a property manager at Jonmer Projects providing a comprehensive understanding of key drivers in both general business and the property market, together with the added benefit of an appreciation of client liaison & needs.

Achievements

Listings featured in this Portfolio - 8 Taylors Road & 2-4 Gordon Road, Morningside

Over $500m in deals overall

$50 million of sales in 2020

Colliers’ ‘go to’ CBD western fringe broker

About Matt joined Colliers in 2006 with a focus on mid to upper end industrial & investment transactions. Specialising in tenanted investments, occupier representation through to vacant land / building sales on the North Shore, Matt was promoted to a North Shore Director in 2015.

Matt Prentice Director | Investment Sales North Shore Mobile: 021 464 904 matt.prentice@colliers.com

In 2013, Matt was in the top 10 Highest Performing Brokers nationwide and in 2014, he had a record year completing more than 50 transactions, and finished in the top 10% of brokers in New Zealand.

In 2015, Matt completed over 60 transactions, more than any broker North of the Bridge, again finishing in the Top 20 brokers in New Zealand.

In 2016, Matt had a record year finishing top 10 in the country and was the top broker on the North Shore.

Achievements

Listings featured in this Portfolio - 8 Taylors Road & 2-4 Gordon Road, Morningside

Over $1.5b in deals overall

Colliers top 5 broker 2020

Colliers top auction broker 2020

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About Commercial property specialist in the Auckland Western Fringe market.

With a Bachelor or Property and Bachelor of Business, along with a Masters in Business, Hamish is well equipped to deal with the complexities of all types of property transactions.

Hamish Paterson Broker | Investment Sales Auckland CBD Mobile: 021 100 7259 hamish.paterson@colliers.com

Onto his fourth year in commercial real estate, with over 80 million in sales, Hamish was recognised as a top 3 finalist in 2019 for the REINZ rising star of the year. Hamish is proactive, motivated and versatile professional, accustomed to adapting to challenging environments and delivering under pressure.

Achievements

Listings featured in this Portfolio - 8 Taylors Road & 2-4 Gordon Road, Morningside

$100m in deals overall

REINZ Rising Star finalist 2019

About Shoneet has been involved in selling investment property for over 12 years and since 2015 he has been a Director in the Investment & Development Sales teams across the wider Auckland region.

Shoneet Chand Director | Investment Sales North Shore Mobile: 021 400 765 shoneet.chand@colliers.com

Over the past 8 years he has been one of the most successful investment sales brokers in Auckland with a unsurpassable track record of significant sales. He has had considerable experience in dealing with international purchasers and has recently completed several deals with investors out of Asia, Europe and the Middle East.

He has been involved in a number of large land sales and portfolio sales, including divestments for well-known brands like Z Energy, The Warehouse & Bunnings.

Achievements

Listings featured in this Portfolio - 4155 Great North Road, Glen Eden

Over $1.5b in deals overall

$325 million of sales in 2020

Colliers top 5 broker 2020

Colliers top broker 2018

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Licensed REAA 2008

HSBC Tower, Level 23 188 Quay Street Auckland 1010 portfolio.colliers.co.nz *This document has been prepared by Colliers New Zealand for advertising and general information only. Colliers New Zealand does not guarantee, warrant or represent that the information contained in this document is correct. July 2021

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