More shops than ever in the pipeline

More than $1 billion worth of shops, restaurants and bars gained building approval last year, half of them in Auckland, contributing to a record $7b of nonresidential consents.

Statistics New Zealand said the $1.1b for the year to November 2018 was 37 per cent greater than the year before.

Of the $1.1b, Auckland made up $516 million of the retail and hospitality building consents, which was almost $200m more than the year before,

‘‘An increase in the intention to build more shops and social buildings was partly due to large consents for Auckland and Christchurch convention centres, and shopping malls in Auckland,’’ Statistics NZ construction statistics manager Melissa McKenzie said.

Consents for ‘‘social buildings’’ were $861m in the November 2018 year – $270m higher than the previous year.

The record $7b non-residential building consents is 6.6 per cent ahead of the previous year. Although some of that is due to rising construction costs, Statistics NZ said there had been a significant increase in the value of shops and social buildings consented in the November 2018 year.

Retail NZ general manager of public affairs, Greg Harford, said increases in migration and tourism meant a greater need for modern and up-to-date retail and hospitality venues.

Population growth was occurring in Auckland, Hamilton and Tauranga ‘‘so you’d expect to see retail and hospitality building going on in those areas’’.

The performance of New Zealand’s retail sector in comparison with overseas retail markets was strong. New Zealand was outperforming Australia for retail sales growth.

Australian businesses and other foreign businesses were ‘‘sniffing around New Zealand’’ with an eye on expanding into this market, Harford said.

But retailers also faced the headwinds of consumer confidence.

Consumers were increasingly facing higher insurance, council rates, and – in Auckland – petrol taxes.