As supply-demand pressure on Auckland’s commercial and industrial property edges buyers and occupiers further outwards, emerging hotspots are experiencing a demonstrable halo effect with values rising.
Ryan Johnson, national director commercial and industrial for Bayleys said infrastructural upgrades, technological advances, a more distributed workforce, a perpetual search for value and the appeal of commercial and industrial property as a well-performing asset class has driven the Auckland halo effect.
“All compass points of the super city have really started to shine, and perception of distance has condensed. Regardless of location, ‘build it and they will come’, seems to be the narrative,” he said.
Across the Harbour Bridge, Daniel Henderson, general manager Bayleys North Shore Commercial, said the North Shore is bulging at the seams.
“There’s very little available within the existing built environment and as large-scale corporate occupiers seek efficiencies from well-located integrated facilities, finding bigger buildings has been a mission.”
Henderson said a new within-region economic triangle has been created with the North Shore, West Auckland and Silverdale at its points, and including Kumeu which is poised to become a sizeable fringe suburb of Auckland.
“Silverdale has been redefined with significant residential and commercial growth pushing the settlement north and south of its traditional village core and we can’t keep up with demand for commercial and industrial space.
“We’re seeing rents increasing, vacancy levels dropping away before our eyes and investor dollars circling – it’s a bouncing ball that is being followed Auckland-wide.
“The broader Silverdale-Wainui-Dairy Flat area will undoubtedly be one of Auckland’s key growth nodes in coming years as the hunt for commercial and industrial opportunities continues, but finding suitably-zoned land will be the handbrake.”
Further north, Chris Blair who leads the commercial and industrial business for Bayleys in the wider Warkworth, Matakana, Wellsford and Mangawhai areas, said roading investment is further opening up opportunity for investors and developers thwarted by shortages elsewhere in the region.
“While there is a real appetite for investment, it’s a somewhat fragmented marketplace with much of the existing stock being tightly-held by individuals over a long period of time and new players wanting to get a foothold on the back of residential growth,” he said.
Blair said Warkworth’s new motorway links will further amplify the appeal of the area, saying every point a motorway arterial touches creates opportunity.
“Land supply, however, is excruciatingly tight with only scattered pockets of identified developable land and nothing of any real scale, so pressure is building up in the system.”
Just over an hour north of Auckland, Mangawhai Central is a new 130-hectare master-planned precinct intended to offer scale and opportunity across the market in the geographical gap between the traditional heads and village of Mangawhai.
The planned precinct will comprise a town square, retirement village, boutique retail stores, food and beverage outlets, supermarket, medically-aligned services, a service zone (light industrial), and childcare facilities – along with a range of residential development sites.
Meanwhile, at Auckland’s southern edge, the former farming community of Pōkeno, now part of the Waikato region, is definitely feeling the halo effect.
It had a resident population of 2,517 at the 2018 Census and growth is projected to reach around 12,000 by 2045.
Bayleys’ national director industrial, Scott Campbell, said the town has changed beyond recognition and did not suffer ‘death by highway’ when State Highway 1 bypassed the town some years ago.
“Large residential developments to the north and west of the village are proving popular and the village itself is undergoing a transformation with Woolworths NZ recently opening its new 3,000sqm Countdown store, and a new fire station under construction to serve the recent urban expansion of the area.
“Dairy companies Synlait and Yashili have large operations in Pokeno, and there’s the 80-hectare Gateway Business Park proving that locations near the Bombay Hills are very much on the cards for development dollars.”
Around 25km further south, the rural town of Te Kauwhata, with a population of around 1,500, is bracing itself to become the “Hobsonville Point of the south” with estimates quadrupling its resident numbers.
Kāinga Ora-Homes and Communities has entered into a partnership with developers Winton in Te Kauwhata and it is projected that the town will become a sizeable dormitory suburb with its residents working in Drury, South Auckland, Huntly or Hamilton.
Mark Fourie, Bayleys Pukekohe, is marketing the Winton-led master-planned development Lakeside, and said around 70 percent of enquiry is coming out of Auckland, roughly 25 percent from Hamilton and the balance from outlying areas.
“As with Pokeno, once the buildings start going up and the street lights get turned on, the sleeping giant will awaken.”
Another 12km down the road, the Comfort Group’s proposed $1.2 billion Sleepyhead Estate manufacturing and housing community at Ohinewai, has been given the green light by district planning commissioners in Waikato with its new Sleepyhead factory under construction and expected to create up to 2600 new jobs.