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Auckland and Wellington

Wellington ranked world first for rental momentum

New Zealand cities Wellington and Auckland have been ranked among the world’s leading cities for rental growth, according to JLL’s latest Global Office Index.


 

 

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​​Wellington ranked world first for rental momentum

Wellington was Asia Pacific’s top performer for recording the strongest quarterly uplift in net effective rents and came in second place to Luxembourg in the top ten global performers list. On an annual rental performance basis, Wellington was in tenth place with a 10.1% increase in rents year-on-year, and Auckland came in eleventh place with a 9.8% year-on-year increase.

JLL’s Global Office Index measures the annual rate of growth on prime office assets across 95 of the major global markets. According to the study office leasing markets made a significant rebound, with global volumes at their highest level since Q4 2011 and expansion demand now firmly on the agenda of many corporate occupiers. 

National Director of Markets at JLL, Mark Grant says, “The accelerated increases in rent in both Wellington and Auckland were due to very strong demand growth for space requirements from occupiers, set against a prolonged period of no new supply coming online in both markets.”

In Asia Pacific, net effective rents increased in over half of markets in Q2 2015. Rental growth accelerated for the second consecutive quarter, with a 0.9% increase (0.5% in Q1) driven by demand from domestic technology and financial firms in most markets. 

Justin Kean, director of research at JLL says, “The technology sector continues to have the most significant impact on leasing markets across the globe and in many markets has led the post GFC revival. We are however now also seeing a broader diversity of demand in with both Finance, Insurance and Real Estate (FIRE) tenants as well as Technology, Information, Media and Advertising (TIMA) pushing demand levels past what was witnessed in the pre GFC peak. Tightening fundamentals are boosting landlord confidence and JLL predicts that prime rental growth will continue to remain positive.”

Notes to editor

The JLL Global Office Index is derived from the weighted average of the rental movements of JLL’s European, Asia Pacific, Americas and Middle East and North African (MENA) Regional Indexes that cover 95 office markets in total. They are weighted by real GDP (US dollar basis) for each region from Oxford Economics. Weights are adjusted annually. The latest weights are 28% - Europe; 32% - Asia Pacific; 35% - Americas; 5% - MENA (percentages are rounded).

The Asia Pacific Office Index is calculated from the change in average Grade A rents (net effective) in the main sub-market in 27 Asia Pacific cities, weighted on the basis of Grade A stock in the main sub-market of each city.​