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Auckland Industrial 2H2010 Pulse

• Auckland’s industrial market is showing encouraging signs
with rental rates and yields remaining relatively stable over
• Economic growth was modest in 2Q10, increasing by 0.2%.
However, this is the first year of positive growth in NZ since
the end of 3Q08.
• The rate of the economic recovery may be slower than many
had hoped. While transport and storage sectors of the
economy continue to rise, manufacturing growth is subdued.
• The changes to depreciation deductions on buildings will be
effective from April 2011. However, the severity of the change
is not as bad as initially expected as fit-outs and fixtures are
excluded. Assets such as lifts, air conditioning, plumbing and
electrical reticulation can still be depreciated.
• It is expected that both prime and secondary yields are likely
to firm at the top end over 1H11 as investors become more
confident in the outlook for the sector.
• Industrial land values have decreased significantly since the
boom period of 2007, making new developments more
feasible for selected developers.
• Anecdotal evidence suggests enquiry for industrial property is
rising. However, most activity continues to be at the top end.

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