The commercial property market recorded an 8.1% positive return and negative 1.7% capital return in the year to September, with an overall positive market return of 6.2% according to the latest data from Investment Property Databank.“Commercial prop
The commercial property market recorded an 8.1% positive return and negative 1.7% capital return in the year to September, with an overall positive market return of 6.2% according to the latest data from Investment Property Databank.
“Commercial property makes a fundamental contribution to the productivity and competitiveness of our economy. It is, and will continue to be, the infrastructure of business - a message that will be encapsulated in the Property Council’s election year manifesto,” Property Council national presidet Chris Gudgeon said.
“Our construction sector, for example, accounts for more paid hours of work than many other sectors and key parts to the national economy. Since KiwiSaver was established, about a million New Zealanders now have a foundation share in commercial property, on their journey to acquire savings and financial security.”
Based on the market performance of 367 commercial properties worth a collective $8.5 billion, the research showed the improvement was 1.3% ahead of the previous period mainly due to the slowing decline of capital values.
The office sector’s annualised total return for the year to September was 4.6% while the industrial sector returned 7.1% and retail returned 7.7%.
“The New Zealand property market has experienced a relatively mild downturn in comparison to other major property markets. The UK and US experienced the greatest decline in total return as they were adversely impacted by the spill over from the global financial crisis,” the Investment Property Databank said in its report.
“Notably, the New Zealand property market moves closely in line with the Australian property market. Over the short term, New Zealand is expected to perform favourably against competing property markets globally.”
