Ian MitchellNBRIan Mitchell
...Another 2200 are also on the cards depending on demand but DTZ head of research Ian Mitchell said it now appeared unlikely many of these would go ahead.
"The apartment market is at or near the bottom of the current cycle with recent anecdotal evidence suggesting that values may be close or just past the bottom of the current cycle."Mr Mitchell
said this could be partly attributed to a change in migration as there were now more Europeans coming into Auckland rather than people from Asian countries who often preferred apartments.Auckland City Council
also has developers worried with its plans to raise levies this year by increasing its open space charges in the CBD.Mr Mitchell
said the migration change had affected rents with studio apartment rents dropping and vacancy levels rising.
However, the opposite is the case for office space where vacancy levels have continued to fall, dropping to 9.9 per cent in September last year, the lowest point for four years.Mr Mitchell
said this had also been reflected in rents, which had risen across all building grades and in particular in the prime grade office space arena. He
said DTZ expected rents to increase 23 per cent over the next five years assuming Auckland's economy continued to expand in line with expectations.
The research also found investor demand remained strong for industrial property, with both rent and property values expected to continue their upward trend.
Over the last five years industrial property values had risen more than 100 per cent across all the submarkets of North Shore/Albany, Mt Wellington/Penrose, Manukau/Airport, East Tamaki and Wiri.Mr Mitchell
said demand for retail space also remained strong, although retailers were coming under pressure with costs rising faster than the price of their goods.