close
MENU
Hot Topic EARNINGS
Hot Topic EARNINGS
1 mins to read

Albany and Grafton offices suffer

Empty office space abounds on Auckland's North Shore and in the CBD fringe area of Grafton, with Wellington occupancy also weakened.
The latest research from property company Colliers showed that office vacancy on the North Shore had hit 15.78% while Alb

Jazial Crossley
Wed, 11 Jul 2018

Empty office space abounds on Auckland’s North Shore and in the CBD fringe area of Grafton, with Wellington occupancy also weakened.

The latest research from property company Colliers showed that office vacancy on the North Shore had hit 15.78% while Albany offices were 10.90% empty.

Overall however the North Shore recorded a decline in office vacancy to 11.83% thanks to Takapuna offices gaining more tenants improving vacancy in that area from 12.35% in March to 10.73% in September.

Grafton office properties are struggling to secure tenants with vacancy at 14.67%, leaving 24,000sq m of office space empty.

“It would be satisfying to see a strong symmetrical correlation between vacancy and rental growth but even when a lag time is applied this isn’t always the case. Theoretically they should be inversely correlated – one goes up if the other goes down – but over the years in Auckland CBD for example, vacancy has reduced while rents were falling, and vice versa,” Colliers director of research Alan McMahon said.

“A more reliable indicator of future demand and therefore rental growth, assuming constant supply, is the Labour Force Participation Rate.”

In Auckland’s CBD prime office market, vacancy was at 9.4% up from 5.4% in June last year. Colliers forecasted that vacancy will rise to 12.2% by June 2011.

Wellington’s smaller prime CBD office space was only 1.7% vacant, up from 0.7% in June last year and predicted to hit 1.9% by June next year.

“In Wellington the new Council and Mayor might be expected to be less development friendly than their predecessors, but in a market where very little CBD development is anticipated this is of less concern than it would have been a few years ago,” Mr McMahon said.

“IRD commence their move into the new Featherston Street HQ this month, and over the course of 2011 will vacate a number of other buildings in the CBD. While their will be an overhang of space in the market, some has been re- leased and momentum appears to be building.”

Jazial Crossley
Wed, 11 Jul 2018
© All content copyright NBR. Do not reproduce in any form without permission, even if you have a paid subscription.
Albany and Grafton offices suffer
10372
false