Tech hubs demand more
Tech hubs, innovation precincts, clusters. They go by a number of descriptions and they are becoming an ever-important part of the commercial real estate market, according to global consultancy JLL.
In a recent report, JLL described tech hubs as potentially ‘‘the most significant change to real estate markets in the post-GFC environment’’.
In major cities like London the tech sector now leased three times the space of all other sectors combined.
Hubs were ‘‘often counter cyclical to the rest of the economy and their appetite for space is driven by technological advancement rather than economic sentiment’’.
Now Auckland was emerging as a global tech hub city, and landlords would have to ditch the ‘‘set and forget’’ approach of structured leases if they wanted to capture that market, the report said.
It recommended landlords adopt a ‘‘service providing mindset,’’ thinking more about the access, location, workplace, building layout and rental terms they offered.
They could consider providing accommodation or social infrastructure, or even consider injecting venture capital to directly align themselves with the interests of the hub.
A good location was a key ingredient in successful hubs, and proximity to infrastructure, clients, talent, and secondary space were common themes.
‘‘In JLL’s view, meeting the space needs for start-ups and tech innovators is going to require a step-change for providers of real estate in the Auckland market,’’ the report said.
Moves
Fletcher Building’s chief financial officer Gerry Bollman has resigned after four years in the job, for another CFO role in the United States.
He will be replaced by Bevan McKenzie, who led the company’s recent acquisition of contractor firm Higgins group.
Prior to joining Fletcher’s, Bollman worked for Boston Consulting Group and Roquette Freres in France. He was a colleague of Fletcher’s chief executive Mark Adamson who headed up Formica when it was bought by Fletcher’s in 2007.
Adamson credited Bollman with laying the foundations for the company’s turnaround strategy.
‘‘Gerry and I have worked together for a number of years and I was delighted when he agreed to relocate to New Zealand in 2012 to lead the strategy team.’’
Bollman had made ‘‘a significant contribution’’ to Fletcher Building’s transformation, he
Rents
said. Wellington retail rents have reached a new record, according to JLL.
Prime upper rents for Lambton Quay frontage were now $3,200 per square metre, up substantially from the base $2,575 level which had persisted since 2011.
Demand was high from high-end retailers, driven particularly by the opening of new department store David Jones.
‘‘Mid to low-tier retailers, however, are suffering from decreased consumer activity.’’
The city’s retail scene was expected to maintain its momentum thanks to the arrival of other international names.
A new retail development on the corner of Victoria and Manners streets could be a catalyst to rejuvenate that part of the CBD in 2017, along with the new Weltec campus being built in Cuba mall.
More buildings were being increasingly converted to university halls or apartments.