Commercial property investors have remained active despite months of Covid-19 disruption, with Colliers International transacting $1.32 billion in commercial sales in Auckland alone between 1 April and 25 August.
Gareth Fraser, Auckland Director of Investment Sales at Colliers, says the strong sales result shows a high level of confidence in the market’s underlying fundamentals.
“Colliers has been highly active in Auckland since the original lockdown in late March, having transacted 138 sales since 1 April,” says Fraser.
“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.
Start your property search
“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 have 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 brokered by Industrial National Director Greg Goldfinch and Director Paul Higgins.
171 Pilkington Road, Point England. The 7.35ha former Pernod Ricard site sold after a collaboration between Colliers’ Investment Sales and Industrial teams. The sale was brokered by Fraser and Goldfinch with Industrial Director Andrew Hooper.
Countdown Howick and Mitre 10 New Lynn. These large format retail stores, both of which offered strong covenant from essential services anchor tenants, were sold by Colliers’ Capital Markets team. The Mitre 10 property was purchased for $32.5m by Mitchell Mackersy for a new property syndication.
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.
50 Centreway Road, Orewa. Auckland Council’s Ōrewa Service Centre sold during the initial lockdown in a deal transacted by Coburn, with Colliers North Shore Directors Jimmy O’Brien and Shoneet Chand, and Strategic Advisory Director Alan McMahon.
The strong run of sales continued in the latest lockdown, including five properties selling via auction.
These transactions included a CBD development site at 29-31 Anzac Avenue, which sold for $6.9m; two Onehunga properties, which sold for a combined $4.13m; and a Mt Wellington industrial property that sold for $3.34m.
Goldfinch says low interest rates, combined with lots of equity, are 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.
“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, says there are still plenty of opportunities for buyers.
“The recently launched Colliers Portfolio features properties that will appeal to a wide range of buyers, from affordable industrial and retail investments, through to large redevelopment opportunities.
“Colliers has numerous new campaigns launching in the coming weeks. Whether you’re looking to invest, own and occupy or develop, our national sales team can assist with a wide range of options.”
The trio expect the end of this year to be an extremely active period for sales activity.
