Shore Office Market
Snapshot Q4 2019
The North Shore stock base and rents remain relatively unchanged while vacancy rates tightened further.
The North Shore office vacancy rates tightened further over the last half of 2019 with Takapuna dropping 29 basis points to 3% and Albany following suit with a drop of 43 basis points to 3.7%.
With no new, large-scale development projects on the go for Takapuna, Albany will continue to benefit from the overflow with space still left to build on. With a fair amount of office space planned for Albany, this trend is likely to continue.
The North Shore stock base remained relatively unchanged with only ~1,350 sqm being taken out for refurbishment in Takapuna. With construction and land costs rising, even though the North Shore has some of the lowest vacancy rates in Auckland, there lacks a supply response from developers to meet the current demand for high quality office stock on the Shore.
With completion due mid-2020, 55 Corinthian Drive is set to be a large asset to the Albany office market, bringing ~5,390 sqm to the Albany stock base. As well as this, 55 Corinthian will deliver 840 sqm of retail space and 283 carparks with a 5 star green rating.
North Shore rents have held stable for the majority of 2019 with no growth or contraction since 2Q19. This was the case with all office subsectors over Auckland except for Newmarket that saw growth at the upper end, increasing the range of rents occupiers were paying in the area.
The suburban market as a whole has seen a tightening of yields throughout the year with further firming over the last quarter to record lows. The average Takapuna yield fell to 5.88% down another 25 basis points in 4Q19. This average sits in a range between 5.25% and 6.50% for Takapuna.