Ian Little, head of the national Bayleys Research team, discussed trends impacting current and future conditions for Christchurch’s commercial and industrial property markets at the Bayleys@5 event on 18 May.
While progress on Christchurch’s CBD may have been slower than expected, Little says the plan for Christchurch’s CBD is becoming reality. “This bodes well for investors, developers and property owners over the next 12 – 24 months.”
The last few months have seen a dramatic rise in public confidence in the rebuild, with the completion of major developments in the city; increasingly diverse retail and hospitality offerings; and plans for future projects like the Riverside Farmers’ Market well underway. Thousands of workers have returned to the CBD, with the completion of the ANZ Centre, BNZ Centre and MBIE building.
With all the development happening in the central city, Little says there is an over-supply of office space at present. While this is creating challenges for the owners of office buildings, he says it presents great opportunities for occupiers. Conditions for the CBD retail and hospitality sectors will improve as the CBD’s population increases, Little says, helped in large part by the East Frame Residential Development, which is currently under construction. With more than 900 homes planned for the area – the first to be completed by May 2018 – the development will increase the central city’s population of the central city by 2000 people. “This can only be a positive thing for businesses in the CBD, and will help to encourage further movement into the city,” Little says.
Further opportunities are presented by the relative affordability of commercial rents and housing in Christchurch, Little says. Christchurch’s affordable commercial rents are attractive to business owners, while there is a growing number of young, educated workers disenfranchised by growing housing values and the cost of living in cities like Auckland.
“Christchurch is going to continue to grow, so here’s the perfect opportunity for businesses to get in while rents are cheaper.”
International political and economic tensions over the last 18 months have also had a positive impact on tourism in Christchurch, particularly for the re-emerging CBD. Visitor numbers are above pre-earthquake levels, rising nine percent from the year to March 2016. International spending has increased 25 percent. “People are curious about how the city is progressing,” Little says. “It’s fantastic for those businesses returning to, or new, to the central city.”
As well as an increase in tourists, the number of migrants settling in Christchurch is holding at high levels. Little says that this number also includes New Zealand ex-pats, who are increasingly returning home. “People are really investing in the future of the city, which is great news for businesses.”
The next Bayleys@5 event will be held on 17 Aug. Click here to find out more and to register your interest.