Taranaki has enjoyed strong economic growth over recent years driven by the dairy and oil sectors. The region’ s GDP expanded 47.5 per cent during 2007-2013, well above the national movement.
Latest figures show that Taranaki contributes 3.9 per cent of national GDP, provides 2.5 per cent of national employment and is home to 2.5 per cent of New Zealand’s population.
Over the last 12 months however the dual drivers of the regional economy have slowed considerably as commodity prices have fallen. The loss of yearly income to Taranaki farmers alone has been estimated to be $736 million. No new oil or gas exploration ventures are planned for Taranaki over 2015...read more.
The prime end of the office market has been dominated over recent years by the energy and engineering sectors. Expansion of companies involved in the above sectors drove down vacancy rates, particularly within the favoured higher quality, low rise premises. As a result rental growth within this part of the market was evident throughout the 2012-2014 period...read more.
As is the case in many town centres, traditional retail businesses have come under pressure as a result of competition from bulk retail centres and changing shopping trends such as e-commerce. The impact is particularly stark within secondary strip locations and, as with offices, within buildings with low seismic ratings...read more.
The downturn in engineering activity is evident within the industrial sector with levels of sales and leasing activity down since mid 2014 following two years of above average activity over 2011-2013. The impact of the slowing in the local economy is illustrated by a dip in construction activity. The number of consents issued for new factories and storage facilities across the Taranaki region fell to 43 in the year to March 2015, down from 69 in the 2013 calendar year and approximately 100 in 2006...read more.
Infrastructure Improvements to Support Growth
While the economy has softened it is important that critical infrastructure be maintained and improved in order to support future growth.
It is positive therefore that work has begun on roading improvements and plans have been put in place for further enhancements within the National Land Transport Programme (NLTP) (2015-2018).Under the NLTP it has been announced that funding has been made available over the next three years for continued investment in improving State Highway 3 heading north from New Plymouth...read more.
New Plymouth airport is the ninth busiest in the country with it currently being used by approximately 343,000 passengers a year. It is forecast that this number will increase to, in excess of, 550,000 over the next decade. An $11 million expansion of the terminal has recently been announced with work anticipated to begin in early 2016 with completion set for mid-2017. The upgrade will provide for floor space within the terminal to increase by 60 per cent, from 1,480 square metres to 2,300, there will be more room for aircraft on the apron and more car parking...read more.
Speciality Retail, Residents and Precincts to drive Vibrant CBD
As noted above vacancy rates within the CBD’s secondary locations have increased over a number a years as shopping habits have changed. This situation is not unique to New Plymouth, indeed it is refl ected in many provincial centres across the country. In many cases it has become evident that CBD’s in their existing form are too large and plans are being considered to reconfi gure them through creating a more compact core and by encouraging residential development in order to create a more vibrant central city which better meets modern day requirements...read more.
Read the full MARKETBEAT report here.