Surging demand for residential development land is expected to drive strong interest in a substantial greenfield site in Auckland's north west.
The 8.17ha property for sale at 88 Fred Taylor Drive, Westgate, comes with a generous mix of intensive residential zoning and it is being brought to market following some high-profile sales of development land in Auckland.
Colliers International, which is marketing 88 Fred Taylor Drive, said it had sold more than $335 million of land since the start of the Covid-19 crisis in March.
Director Josh Coburn says demand has remained steady, even through the resurgence of the virus in Auckland last month.
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“Residential property, and land in particular, is seen as a resilient investment in times of economic uncertainty. This has kept demand buoyant," he said.
“New development is continuing apace, with the construction sector able to deliver at all but the highest Covid alert level. This provides a safeguard for developers seeking opportunities in the current market.
“The combination of strong demand for housing, positive market sentiment, and good construction sector capacity, make this an ideal time to buy development land.”
The property for sale at 88 Fred Taylor Drive is located in the heart of Westgate, at the gateway to the 600ha emerging suburb of Red Hills.
It provides a combination of Terraced House and Apartment Building and Mixed Housing Urban zoning, allowing for a number of development options.
The land will be sold with a bulk earthworks resource consent in place, but awaiting a developer’s identity to be stamped on the subdivision and land use consents. Expressions of interest close at 4pm on October 15.
The deal for 17 Upland Road, in Remuera, was concluded during the first lockdown. Photo / Supplied
Coburn said: “Westgate and its immediately surrounding suburbs have become established in the last five years as Auckland’s preeminent location for residential development.
“Land in this area has been scarcely available, and a recent surge in activity in the residential market will give both developers and land-bankers confidence that 88 Fred Taylor Drive is a superior offering to anything else available for sale right now.”
Craig Smith, associate director of site sales at Colliers, added: “Westgate’s established residential and commercial precincts continue to grow as Auckland Council executes its plan for the area, which serves as the principle centre for the northwest community.
“The site for sale lies on the western boundary of the Westgate commercial precinct, which includes the Northwest Shopping Centre, Mitre 10 Mega, a new Bunnings, and the site of what will be New Zealand’s first Costco.
“The site’s direct neighbour to the south is Malbec – a new subdivision of 244 homes that is well under construction."
Land transactions represent more than a third of Colliers' overall commercial property deals in Auckland since the start of April, with the agency racking up $1.3 billion in sales.
Gareth Fraser, Auckland director of investment Sales at Colliers, said the strong sales showed a high level of confidence in the market’s underlying fundamentals. “This level of momentum has been undiminished by the resurgence of Covid-19 in the community. Colliers transacted more than 25 deals in Auckland between 12 to 25 August, during the most recent lockdown.
136 Fanshawe Street, in Auckland CBD, was snapped up for $315 million. Photo / Supplied
“We’ve seen some truly outstanding deals in recent months, which highlights the strength of the Auckland commercial property market in the face of economic uncertainty.”
Notable sales included:
• 136 Fanshawe Street, Auckland CBD. The Mansons TCLM office development, which is currently under construction, was purchased by offshore institution PAG for $315 million. The sale was transacted by Colliers’ Capital Markets team, following a complex series of related sale and lease deals involving Colliers’ Investment Sales and Commercial Leasing teams.
• 17 Upland Road, Remuera. The former Caughey Preston Trust site was purchased by a residential developer during the initial lockdown in a deal transacted by Colliers’ Capital Markets, Investment Sales and Site Sales teams.
• 35, 55 and 67 Kerwyn Avenue, East Tamaki. Hynds appointed Colliers’ Industrial team to sell and lease back its East Tamaki concrete pipe manufacturing facility ahead of a move to a new facility in Pokeno. A conditional offer fell through due to the global Covid situation, prompting Colliers to seek unconditional offers from other parties. The result was a strong sale in challenging conditions for $35 million, brokered by Industrial National Director Greg Goldfinch and Director Paul Higgins.
• 28-44 and 50-66 Westgate Drive, Westgate. The 6.96ha landholding, comprising 11 ready-to-develop, high-density residential lots, was purchased by a local buyer after very high levels of enquiry. The deal was brokered by Blair Peterken of Colliers’ Capital Markets team with Site Sales Director Josh Coburn.
Goldfinch said low interest rates, combined with lots of equity, were fuelling purchaser demand.
“At the same time, low levels of stock and historically low vacancy rates prior to Covid-19 have limited supply, keeping prices at very strong levels," he said.
“We expect these trends to continue in the near and long terms, particularly with the prospect of a negative OCR making it even cheaper to borrow.”
Peter Herdson, national director of capital markets at Colliers, said there were still plenty of opportunities for buyers and expected spring and summer this year to be an extremely active period for sales activity.
