New Zealand industrial market snapshot Q2 2021
JLL’s New Zealand Industrial Market Snapshots provide property insights into how the industrial and logistics market is faring within Auckland, Wellington, and Christchurch.
Our real estate market research is based on data from several reputable sources including on-the-ground insights from our own departments. Reading our property insights from the previous quarter will help to guide your property decisions in the quarters ahead.
Despite the unprecedented nature of 2020 nationally, regionally, and globally, it is rare to see major market changes occurring between January and March in New Zealand, and so it has proved for the most part with industrial property the exception, which saw further yield compression.
At an activity level, there has been a clearer sense of occupier and investor appetite and interest, particularly for good quality assets. Industrial properties remain most sought after by tenants and investors alike due to strong demand assets with investors heavily favouring prime and defensive assets.
The price, naturally, needs to be right, but both demand and supply are creating opportunities.
Given such strong performance over the past year, uncertainty has become less of a consideration for the industrial sector. Landlords are no longer prepared to accept short lease terms in a bid to fill space as they were in 2020. The length of leasebacks has also begun to extend particularly for lower quality space, where the additional certainty provided by a longer lease term supports yield compression.
Auckland continues to maintain one of the most active industrial sector development pipelines in the country (although speculative build activity has slowed), Wellington’s defining characteristic continues to be its lack of available stock, while Christchurch has an active and competitive investment market especially for prime industrial assets.
Some of the questions answered in the latest report include:
- Are the low vacancy levels among industrial stock expected to continue?
- What kind of industrial property yields is the current market offering?
- What industrial projects are in the pipeline for Auckland, Wellington, and Christchurch?
Find out more below.