OfficeMax moves to brand new building in Rolleston
The Christchurch industrial market continues to deliver with OfficeMax the latest to commit long-term investment.
Christchurch, November – OfficeMax, part of US giant Office Depot, has committed to a long-term investment in Christchurch having moved to a brand new distribution headquarters.
Negotiations have successfully concluded for a new 10,825sqm design-build in Rolleston.
The company was looking to scale up its operations with a larger distribution centre. JLL were appointed as exclusive brokers, and recommended incorporating a new design-build with a major Christchurch developer as part of the sale of 35 Hickory Place, its former distribution centre.
JLL Head of Christchurch Hamish Stallworthy says the team canvassed the entire Christchurch industrial market and asked a shortlist of developers to put forward proposals. From this, Calder Stewart were selected as the preferred developer.
“Design-build rates are currently very comparable to that of existing industrial stock,” says Stallworthy.
“We’re confident that this, coupled with the ability to have an industrial building tailor-made to suit a tenant’s needs is going to further drive the Christchurch industrial design-build market.”
OfficeMax considered multiple sites in both Hornby and Rolleston, which JLL Broker Tom McAuliffe says further cements the western fringe of Christchurch as the most desirable location for new industrial builds.
“Upon reviewing the financial models presented during the process it became apparent that there were significant rates savings of approximately 85% to be achieved for OfficeMax through being located in Rolleston,” says McAuliffe.
“We’re delighted that another international company has shown its long-term commitment to Christchurch by significantly expanding their operations from pre-earthquake levels.”
Research from JLL shows the industrial market in Christchurch is set to continue its steady growth, with blended rental rates for both prime and secondary industrial space in Christchurch undergoing a slight uptick in the last quarter.
These rates are forecast to gradually increase over the next few years, as demand remains constant with new supply coming to the market remaining limited. Operating expenses are also expected to see a rise as a hike in rates and insurance premiums is foreseen.
A market remains for secondary stock but occupier preference clearly lies in the prime sector, with the impact hitting the lower quality and older stock the most. With the slow-down in supply, rental rates have mostly stabilised and occupiers are continuing to seek higher-grade space now that the price has normalised for its previously inflated state.
JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. JLL shapes the future of real estate for a better world by using the most advanced technology to create rewarding opportunities, amazing spaces and sustainable real estate solutions for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $16.6 billion in 2020, operations in over 80 countries and a global workforce of more than 91,000 as of March 31, 2021. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit jll.com.