As confidence returns, so will the tenants

Development activity in the Auckland industrial market is at its lowest level for years, but some increase in tenant demand is expected as the economy works its way out of recession, says Bayleys Research in its latest overview of the market.

Bayleys' senior analyst Ian Little says greatly reduced development activity has slowed land absorption significantly while vacancy rates, which have been at historically low levels for most of this decade, have come under pressure in some precincts.

The impact of the cooling economy on the Auckland region's industrial property sector is well illustrated by the result of recent land uptake and vacancy surveys in the Manukau City and North Shore industrial precincts.

The slowdown in development activity is particularly evident in Manukau City, the region's largest industrial precinct.

Land absorption over the 2008-09 survey period was recorded at just below 17ha. With the exception of 2002, this is the lowest level of uptake recorded since the mid-1990s. The absorption figure peaked in 2003 at 76.1ha, with the average annual uptake between 2003 and 2008 sitting at 63ha.

To read the full NZ Herald article, click here

Posted: 10 Oct 2009

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