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Tight at the top in our two biggest cities

Tight at the top in our two biggest cities

JLL’s Third Quarter Vertical Vacancy Review suggests business confidence remains high and employers recognise the importance of quality workspace in the highly competitive war on talent.

Auckland, 30 October 2019 – Competition for prime CBD office space remains fierce in Auckland and Wellington.

JLL’s latest Vertical Vacancy Review outlines low vacancy rates and strong pre-leasing activity on space scheduled to come to market over the next two years.

Vacancy in Auckland’s four premium CBD towers (Lumley Centre, PwC Tower, ANZ Centre, and Vero Centre) is currently at just 2.6%, while the new PwC Tower at Commercial Bay due for completion in April 2020 is already 80% committed.

Just under 8% of existing prime CBD space is expected to become available as tenants move to newly-built premises, but JLL’s Head of Auckland Office Leasing, Graham Kristiffor, expects this will be absorbed quickly as businesses look to upgrade from secondary stock.

“Businesses are increasingly seeing the value rather than the cost of providing high quality office space for their staff, as they consider this a key factor in enhancing engagement, loyalty and productivity,” says Kristiffor.

“In-building amenities, co-location with complementary businesses and proximity to transport nodes are far more appealing to today’s worker than an available parking space.”

Vacancy is even lower in Wynyard Quarter, with only 1,300 sqm of prime office space (0.7%) currently available. Furthermore, with 85% and 98% of space pre-leased respectively at One55 Fanshawe and Innovation 5B, which are both due for completion next year, Kristiffor says the next significant office space opportunity here will be the 20,000 sqm at 136-142 Fanshawe Street, scheduled for completion in 2021.

In the nation’s capital, CBD Grade ‘A’ space is at even more of a premium with only 1500 sqm – 0.5% - currently available, and no more space scheduled to be added until late 2021 with 20,000 sqm at 40/44 Bowen Street.

JLL Leasing Negotiator, Isaac Hunter, says that sustained demand in Wellington is driven by a high-level of pre-leasing and the increasing footprint of government departments.

“Argosy’s $64M redevelopment at 8-11 Willis Street is a good example of the current Wellington market dynamic,” says Hunter.

“This will deliver 11,000 sqm of Grade ‘A’ space by 2021 – which will be taken under a 15-year lease by Statistics New Zealand.”

JLL’s Third Quarter Vertical Vacancy Review can be downloaded here.


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About JLL
JLL (NYSE: JLL) is a leading professional services firm that specialises in real estate and investment management. Our vision is to reimagine the world of real estate, creating rewarding opportunities and amazing spaces where people can achieve their ambitions. In doing so, we will build a better tomorrow for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $16.3 billion, operations in over 80 countries and a global workforce of over 91,000 as of March 31, 2019. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit www.jll.com.

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