Boom times stretch prop­erty mar­ket

The Napier Mail - - WHAT’S ON - CHLOE WIN­TER

Com­pe­ti­tion is start­ing to wear thin in Hawke’s Bay’s com­mer­cial prop­erty mar­ket, which has been ex­pe­ri­enc­ing its most buoy­ant sales pe­riod in over a decade.

Valuer Tur­ley & Co’s lat­est prop­erty mar­ket re­port found the first six months of 2017 had good lev­els of ac­tiv­ity off the back of a ‘‘hum­ming’’ 2016.

It was the re­gion’s strong­est mar­ket since be­fore the global fi­nan­cial cri­sis.

But while there is still solid de­mand for good in­vest­ment prop­er­ties, com­pe­ti­tion is dwin­dling, the re­port says.

‘‘Com­pe­ti­tion has thinned as banks tighten credit avail­abil­ity and oth­ers sit on their hands in elec­tion year. It is harder to fi­nance com­mer­cial prop­erty now than it was eight to 12 months ago.’’

There has also been a ‘‘stark re­duc­tion’’ in the num­ber of good qual­ity prop­er­ties up for sale, which is frus­trat­ing buy­ers, it says.

This co­in­cides with a low num­ber of in­vest­ment sales first half of 2017.

How­ever, there has still been dozens of mul­ti­mil­lion-dol­lar com­mer­cial and in­dus­trial de­vel­op­ments, and sales, it says.

‘‘The stars con­tinue to be aligned for the Hawke’s Bay’s econ­omy that will likely con­tinue to ramp for the fore­see­able fu­ture, pro­vided there are no ma­jor ex­ter­nal shocks.

‘‘There is a bow wave of op­ti­mism.’’

The largest de­vel­op­ment planned is a $100 mil­lion berthing fa­cil­ity at Napier Port ‘‘in re­sponse to record-set­ting ex­port vol­umes led by high growth in lo­cal viti­cul­ture, hor­ti­cul­ture and forestry’’, the re­port says.

Rapid ex­pan­sion of pipfruit and viti­cul­ture in­su­lated the prov­ince from na­tion­ally poor dairy per­for­mances, which are now re­bound­ing, it says.

Mean­while, prime in­dus­trial prop­er­ties are ‘‘keenly con- tested’’ as shown by sales last year of BOC Gas Napier and PBT Trans­port build­ings, the re­port says.

In ad­di­tion, re­tail va­cancy in Napier and Hast­ings has im­proved, but the fringes are ‘‘anaemic’’, par­tially due to the pop­u­lar­ity of big box re­tail, it says.

In the of­fice mar­ket, seis­mic per­for­mance has been a lead fac­tor in con­sid­er­able com­mer­cial prop­erty ac­tiv­ity since 2012.

While there re­mains room for growth, Tur­ley & Co’s re­port says it is pos­si­ble the Hawke’s Bay mar­ket is at or near a peak in com­mer­cial prop­er­ties’ val­u­a­tions.

PHOTO: CATHERINE HAR­RIS/STUFF

Prime in­dus­trial prop­er­ties are keenly con­tested in Hawke’s Bay.

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