Office market remains favoured asset class in Auckland | 26 March 2014
Office space is still the most sought-after type of real estate on the Auckland property market, according to a new report.
A review of recent activity across one of New Zealand’s busiest cities reveals a year-on-year rise in commercial property sales compared to the first half of 2013, with the demand for offices driving the figures forward.
Conducted by real estate group Jones Lang LaSalle (JLL), the report shows the market gaining momentum as investors rush in to snap up quality assets.
Analysts reporting to voxy.co.nz claim to have seen evidence of commercially astute occupiers securing the highest quality office buildings before rents around Auckland begin to step up. However, investment activity has already been tipped to remain strong and JLL believes a shortage in supply of properties will give landlords a great deal of pulling power over their tenants.
Experts believe the increasing demand from tenants will also result in positive absorption and keep vacancy rates in Auckland down below the long-term average.
Cited by scoop.co.nz, Mark Grant, national director of markets at JLL, tipped the market to welcome further improvements in the short term as the demand for prime assets steps up.
“In line with increased occupier demand, we anticipate a continuation of strong investor demand resulting in a continued firming of yields to new low levels,” he added.
The views expressed in this post are those of the author and are not necessarily those of Qube Global Software. All facts are verified where possible directly by the author.
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