Bayleys tips northern corridor to drive boom
Big infrastructure projects are helping fuel growth in Wellington’s commercial property market.
BAYLEYS is bullish about the Wellington commercial property market heading into 2015, saying it is ‘‘on the cusp of its biggest construction boom in many decades’’.
The real estate agency believes a gathering market turnaround will be fuelled by the construction ‘‘boom’’ – based around major infrastructure projects.
Bayleys has picked out the development of the northern corridor roading projects as a major driver for growth over the next year.
Airport extension plans – the redevelopment of the main terminal is underway and car park expansion and a new Rydges Hotel are planned in the next five years – are also likely to boost growth.
The extension of the runway remains on the drawing board but could also be a boon should it go ahead in future.
Wellington Airport Retail Park was looking to expand, with five more retail sites to the north of its current site creating 2395 square metres of additional space.
Meanwhile, western Petone may see bulk retail expansion. Briscoes is likely to develop twin Briscoes/Rebel Sport stores on the former Colgate site on Nevis St and the New Zealand Mail Centre, sold to developers Seaview HP, has resource consent to become a Bunnings Warehouse store.
In central Wellington, the first stage of development of the corner of Cuba and Dixon streets will begin in the autumn. It will be a six-storey building with 1500sqm of office space and a 9000sqm campus for creative and performing arts as part of the Whitireia-WelTec Strategic Partnership.
Bayleys commercial director Mark Hourigan said the infrastructure development should ripple down into the commercial property market, with more tenants, owner-occupiers and development opportunities on the cards.
‘‘Wellington has a fairly conservative investment environment and it generally takes longer for things to turn around than in Auckland, but there’s been a noticeable improvement in the mood of the market,’’ he said.
Bayleys had sold the Harbour City Centre on Lambton Quay for $45.85 million and it had also seen a revival in the auction market.
In its final auction last year, two large Ngauranga industrial premises once used by Fonterra and Armourguard sold for almost $6m. Projects like the Kapiti Expressway will help drive the commercial property market over the next year and onward.