New Zealand retail market snapshot Q3 2021
JLL’s New Zealand Retail Market Snapshots provide property insights into how the retail 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.
Almost a year on from the beginning of New Zealand’s first lockdown, the respective retail markets in Auckland, Wellington and Christchurch are showing a divergence in response to the challenges of the last 12 months.
In Auckland the markets are showing signs of stability. Commercial Bay has recently celebrated its first anniversary following an overall successful launch. Supported by strong footfall with a significant response in workers returning to offices, retailer demand continues to focus on the lower Queen Street and Britomart precincts while vacancy remains notably higher for upper and midtown areas.
Suburban retail vacancy has also largely stabilised, though this is location dependent. Despite the challenge of the past year, we have continued to record stable average metrics for both Auckland CBD and Suburban retail assets in with rents and yields both remaining stable.
In direct contrast, Wellington CBD retail is experiencing significant challenges following a substantial drop in foot traffic along the Golden Mile, though also felt in secondary CBD locations. This has seen many retailers close over the last year as they reduce their focus on a traditional brick and mortar presence to transition to an online model to channel their focus on e-commerce.
Of the three main cities, Christchurch maintained the tightest market for retail property in Q3 with overall vacancy dropping from 7.5% to 6%, maintaining the downward trend since 2018. Christchurch benefits from a higher proportion of quality retail stock than Wellington or Auckland as a result of rebuild activity, which has contributed to tenant retention. We have recorded stability in both prime and secondary retail rents and yields for Christchurch, a trend we expect to continue.
Some of the questions answered in the latest report include:
- Which retail market is facing the largest challenges?
- How are Q3 retail rents and yields faring?
- What retail projects are in the pipeline for Auckland, Wellington, and Christchurch?
Find out more below.