Wellington retail vacancies on the rise as new properties open

Lambton Quay Wellington
Lambton Quay in the heart of the Wellington CBD.

Retail vacancies in Wellington City are expected to increase as new properties open – but strong projected migration and tourism growth will add consumer demand, according to a forecast.

Investment management company Colliers in its June survey said that 38,000sqm is under construction in Wellington, with consents issued for a further 28,871sqm.

Colliers recorded a vacancy rate in the city of 5.6 per cent during the second half of this year, a slight uptick from the 5 per cent six months earlier, translating to an additional 500sqm becoming available.

The research noted that the success of Precinct’s Willis Lane project demonstrates strong consumer appetite for additional space. Total stock declined to about 134,600sqm as properties, including the former David Jones space, entered refurbishment.

Wellington strip retail vacancy rate by precinct

Negotiations are underway for new tenants for the ex-David Jones space.

Meanwhile, average gross face rents slid to $1238 per sqm in the six months to June from $1253 per sqm in the previous half-year, amid discretionary income becoming increasingly limited, higher interest rates, and rising operating costs.

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