Rents in key CBD retail strips in Auckland and Wellington remain static, according to new research.
Colliers latest rental survey, released today, has found that overall retail vacancy in Auckland increased by 2.6 per cent from 2.3 per cent over the last twelve months, but that rents remained largely the same.
CBD strip vacancy decreased by 3.5 per cent, while shopping centre vacancy was up to 2.3 per cent.
“The demise of some well-known retailers last year highlights the competitive nature of the retail market, and the growing threat of e-commerce,” Colliers research manager Leo Lee said.
“Landlords are expected to temper their expectation of rent rises, especially in areas with less exposure to foot traffic.
“Talk of how to ‘Amazon-proof’ retail destinations will see food and beverage being the centre of new retail developments,” he continued.
In Wellington overall vacancy dropped to 6.9 per cent, 1.9 per cent lower than a year ago.
“Retailers are waiting for the right space to become available. This is likely to keep prime rents static over the short term,” Lee said. “Non-core locations enjoyed modest rental growth, as refurbishments reduced the total stock available in some precincts.”
A lack of opportunities in Wellington has kept investment activity rather low, with retail property sales reaching only $8.1 million in 2017, half that of 2016.
