Hamilton commercial property confidence hits new highs

Investor confidence in the commercial property market is on the rise in the majority of New Zealand centres making the outlook for 2010 more positive than 2009 but still plagued with difficulties.

The latest Colliers' research report reveals that Hamilton had the biggest boost in confidence from investors' perspective.

This comes following market activity in 2009 such as works starting at McConnell Property’s $100 million multi-use business complex Titanium Park.

Another significant Hamilton commercial property movement last year came with rich lister Brian Perry selling a section with Waikato river views to the council while retaining development rights to it. A public plaza is planned for the site.

The confidence results make Hamilton the only other city apart from Tauranga to have more positive investor responses than pessimistic.

However, confidence declined in four of the 11 centres monitored. Dunedin and Palmerston North, which delivered the most miserable reports from investors.

Confidence steadily rose in Auckland and Wellington last year but toward the end of 2009 became static.

Industrial property was the highlight of the commercial property market in both of these areas, but office vacancy rose to 11.5% in the Auckland CBD in December 2009 compared to 8.4% in June of the same year.

In Wellington the most recent office vacancy figures are 6.9% as at December, up only 0.9% from six months prior.

“From a property point of view, we ascribe this to a -r2e600%a%lisation that the optimism of mid-2009 may have been somewhat irrationally exuberant,” Colliers research director Alan McMahon said.

“Now, these results may indicate that investors and business alike are thinking that while there is light at the end of the tunnel, it’s a long tunnel and we’re on slow train.”

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