What’s happening to the ‘book fridge’?
Christchurch people may remember possibly the smallest book exchange in the world.
It’s a fridge crammed full of books on an empty corner site on the corner of Kilmore and Barbadoes streets, east of the city centre.
It drew scores of locals after the earthquakes who were encouraged to bring a book along and swap it with one in the fridge.
It was one of the many innovative projects created by the Gap Filler arts initiative to bring life and activity to the vacant spaces around Christchurch.
And it’s still attracting book readers. The new owners of the
404 square metre site on which the fridge still stands are deciding if they can incorporate it or something like it into the development of the site.
The site has been bought from family owners by a charitable trust, Te Wha¯nau Trust, which owns the well-known Piko Wholefoods, directly across the road from the site which has a
$255,000 capital value. Chris Harding of JLL brokered the sale.
Pikos spokesperson Brigitte
Unwin said Gap Filler had been looking after the fridge and Pikos would take over until it had decided on its plans for the site.
‘‘It’s amazing. It’s really busy. The books get changed over a lot. Our packing room and my office looks straight on to it. There’s always people there.
‘‘It’s got a nice wee seat over there. Sometimes people sit, depending on the weather.’’
Unwin said Pikos would like to build a two-level building with shops on the ground level and a commercial kitchen for Pikos.
It might put a couple of office spaces in the building as well and would like to attract other likeminded businesses to the area.
‘‘We’re a destination shop so if people are coming to us it would be good if they could go to whatever else it is they might need. It would be great if we could keep some trace of the fridge.
‘‘There’s some amazing little book fridges online that are sometimes attached to walls. They are more like post boxes kind of thing.’’
Pikos wanted any building to be aligned with its ideals. Part of that was making a space that was inviting to people in Christchurch.
‘‘So it would be great if it had some courtyard, some bike charging stations, somewhere to sit out of the wind and something like the book fridge, if not the book fridge.
‘‘We want it to be funky. That’s probably a very old-fashioned word.’’
Unwin said Pikos wanted to keep the community engaged with the spaces around them.
No plans had been drawn up. It wanted to hold a community meeting for neighbours and businesses near them to get ideas and input.
Among the ideas being promoted was an organic butchery or an organic wine bar.
‘‘To be able to afford to build it we need to be able to rent it.’’
Planning for the site would probably be left until next year as Christmas was a busy time. It was a social enterprise and charitable trust and donated its profits to community groups.
Commercial property owners should brace for less demand from investors and tenants as the economy slows.
Westpac’s ‘‘Economic Insight’’ on the commercial property market also warned that this coming year some low vacancy rates might rise and rent increases could be constrained.
Commercial property had had a solid run in recent years and the two drivers were primarily the strength of tenant demand for space and investor appetite for properties, Westpac senior economist Satish Ranchhod said.
The key question was the extent of the economic downturn. Westpac expected it to be moderate but the risks for it to be greater had increased.
‘‘A deeper downturn in growth could significantly dampen demand from occupiers,’’ Ranchhod said.
And, it could rattle investors, leading to a tilt towards bank deposits, even with further interest rate cuts.
The conditions that had supported a strong commercial property market were changing, Ranchhod said.
GDP growth had slowed from 3 per cent to 4 per cent earlier in the decade to just 2.4 per cent in the year to June. And population growth had shrunk to 1.6 per cent from 2 per cent in 2016.
Business confidence had plunged and businesses had wound back their plans for spending, including on new buildings. That was coming at the same time as a number of new developments were reaching completion.
‘‘We expect that these conditions will dampen occupier demand for new space over the coming year and will result in some increase in vacancy rates from current low levels.
‘‘Those conditions are likely to constrain increases in rents.’’
While the slowing economy would raise some flags for investors, Ranchhod said Westpac expected demand to remain strong over the next few years.
Occupier demand might soften for commercial property space but that followed a marked tightening in vacancy over recent years.
In addition, although GDP growth had cooled, the slowdown was expected to be moderate.
With interest rates likely to remain low here and overseas, that was likely to over time boost demand and economic growth.
Westpac believed investors’ appetite for commercial property would remain firm for some time and commercial property would remain an attractive investment compared to many other forms of investment.
The vast majority of commercial property sales were less than
$2 million.
Gross returns in Auckland were now averaging about 5.4 per cent to
5.9 per cent. In Wellington and Christchurch they were 6.7 per cent to 7.1 per cent. By contrast, the return on a six-month deposit was only 2.8 per cent.
Commercial property returns were more attractive than residential.
Gross rental returns on residential property were about 2.7 per cent in Auckland and 3.5 per cent in other parts of the country. At the same time, regulatory changes had eroded the appeal of residential property as an investment.
Commercial property values had been rising rapidly in recent years, around 7 per cent a year in Auckland.
That would
have
likely reinforced investors’ appetites for commercial property.
However residential properties were easier to resell though at times of economic stress it could be hard to sell residential and commercial property.
Over the past five years, rapid population growth had supported growth in commercial property.
About 48,000 jobs had been added in occupations that traditionally occupied office space, up
10 per cent. Another 38,000 had been added in retail and hospitality, up 12 per cent, and 21,000 jobs had been added in industries that occupied industrial space, up
5 per cent.
While there had been a substantial increase in non-residential building it had not kept up with demand, resulting in falling vacancy in Auckland and Wellington to low levels and rising rents, especially for office and industrial space.
The continued growth in online shopping and changing consumer preferences like more hospitality offerings had brought reduced demand for retail space.