New Zealand Market Dynamics - Q2 2024
JLL New Zealand’s Market Dynamics report provides property insights into how the office, retail, and industrial sectors are faring across Auckland, Wellington, and Christchurch.
- Gavin Read
- Hina Imran
Our real estate market research is based on data from several reputable sources including on-the-ground insights from our own departments.
Office
Across the country, occupiers continue to seek the best amenities and locations to attract and retain talent in a continuously competitive employment market. In Auckland, Wellington, and Christchurch, growth in net prime rents continued in Q2, however at a slower rate than previously experienced. In the capital and Christchurch in particular, no further growth in net prime rents is expected through to the beginning of 2025 either due to uncommitted space in new or refurbished buildings coming online before the end of the year, or due to expected increase in vacancies in the coming months.
Industrial
Industrial real estate continues to be the most stable and active sector across the markets that we track. In Auckland, vacancy across the precincts remains stable at just 2.3%, with net prime rents also remaining the same at $215 per square metre. In Wellington, vacancy dropped 0.1% to a historic low of just 1.0%, while average prime gross rents remained stable at $192 per square metre. Wellington’s development pipeline is the smallest across the three main cities due to the extreme scarceness of available land. For the Garden City, the national trend of rents remaining stable continues, at $160 per square metre, while vacancy dropped 0.7% to 1.7%. In the Christchurch and Auckland markets, there has been an increase in sales activity for Q2 with circa $45 million and $72 million respectively in transactions.
Retail
CBD prime retail markets across Auckland, Wellington, and Christchurch have continued to rebound during the first half of of 2024, with Christchurch being the standout. All cities have experienced significant leases recently completed, highlighting the continuing demand from luxury/premium retailers for prime locations. In Auckland, large-format retail has had $66.46 million in sales transactions this year. In Wellington, retail sales activity has been the quietest across all precincts for the past 18 months. In Christchurch, the upwards trend in average prime net rents continues, up 12.9% this quarter to reach $875 per square metre – circa 40% higher than the rent at the same time last year. This is on the back of low vacancy in the market, reducing to 4.4% after dropping by 0.6% this quarter.
- How great will the divergence between prime and secondary office space vacancy become in 2024?
- Where is transactional activity picking up the most for the industrial sector?
- Where is demand outstripping supply for retail space?
Find out more by downloading our Market Dynamics report below.
