Auckland’s newer apartment developments have spread out to the suburbs and are helping to mold communities and re-define apartment dwellers.
Historically, Auckland apartments were in the CBD, grown by a 1990s boom in smaller, cheaper units largely catering to renters including students.
Their suburban drift started with off-the-plans sales from 2015 on, says Colliers national director of residential project marketing, Pete Evans.
He says: “The baby boomers are the largest demographic shift in the apartment market. There is a huge increase in numbers of baby boomers and empty nesters getting to the stage where they’ve raised their families and no longer require the family home.
Start your property search
“Some want to live in a more lock-up-and-leave property, possibly complimenting a bach, and some want to free up some of the large equity that’s built up in their family home.”
However, these people typically matured in the suburbs and don’t want to move away from their social networks.
Other drivers for apartment’s geographic spread include Auckland’s swelling population and the Unitary Plan’s drive to increase density around village centres and transportation nodes. Also, public transport improvements are upping the ease of living in apartments outside the CBD.
Evans says these non-CBD apartments tend to have sprung up in locales which have good amenities in a village set-up and near transport links and parks. He says the location trend going forward will continue to be apartments near such set-ups, both quality apartments for baby boomers and more affordable apartments for the rental/investment market.
Looking at types of new Auckland apartments outside the CBD, Colliers puts them in two segments: city fringe/inner suburbs, and suburban/outer suburbs.
Inner suburbs would include Ponsonby, Grey Lynn, Mt Eden, Epsom, Remuera, Newmarket and Parnell, stretching to Takapuna and the Eastern Bays to St Heliers.
Outer suburbs are those such as Mt Albert, Onehunga, Mt Wellington and beyond.
Evans says new projects in the inner suburbs have a similar average asking price per square metre to CBD ones (based on developments recently completed, under construction, or being sold off the plans). Those in the inner suburbs averaged $13,558 per square metre (psq m) against the CBD’s $13,892/sq m. Outer suburbs were typically cheaper, averaging $9233psq m.
But most Kiwi buyers focus more on the total price, and because apartments in the inner suburbs typically outsize others, the average asking price ($1,339,779) peaked compared to the CBD ($1,170,454) or outer suburbs ($851,012).
These are trends rather than rules, with exceptions including premium CBD apartments being developed.
Apartment developments recently completed in the inner suburbs include Miro in Enfield Street, Mt Eden (95 1-bedroom to 3-bedroom units), and St Marks in St Marks Rd, Remuera (58 2-bedroom to 3-bedroom units).
Alexandra Park Urban Village’s first building is scheduled for completion in 2019 (the village eventually rising up to nine storeys, delivering around 250 1-bedroom to 4-bedroom residences also including townhouses).
Examples of suburban projects, aka ‘slightly outer suburbs and beyond’ include Otahuhu’s Mason Square (79 1-bedroom to 3-bedroom units, stage 1 completed, stage 2 completing mid-2019). Stage 1 of Fabric Onehunga (161 1-bedroom to 3-bedroom units) and Okla in Albany (117 1-bedroom to 3-bedroom units) schedule 2020 completion.
The effects of this new wave of apartments outside the CBD includes encouraging more life in local villages such as Mt Eden and Kingsland as demand increases for cafes, bars, local retail and other businesses.
Sometimes they’ll influence what’s popular. For example, areas where new apartments bring significantly more time-rich baby boomers near a village might see them eat out three times a week and so prefer mid-priced to more expensive dining.
Evans is adamant it’s a fallacy that the growth of apartments is placing much more pressure on school zones. Apartment demographics simply don’t support that, he says.
“Very few families with schoolage children live in Auckland apartments. I believe you could be talking another generation, another 20 to 30 years, before you see that.”
Apartment growth is seeing parks and reserves frequented more. Less than 10 per cent of new developments incorporate their own significant green spaces.
Evans says more affluent inner suburbs buyers typically still demand dedicated car-parking, thus minimising their effect on street parking, despite council encouraging developers to cut back on car parks to maximise public transport use.
Increasing demand for land for apartments in areas such as Morningside and Onehunga is seeing light-industrial businesses being priced out of the market and, as a result, tending to relocate further out.
Apartment demand will continue to see poorer condition, older dwellings on larger sections make way for two to five-storey apartment blocks.
The changing face of Newmarket
Gone are the days when Newmarket’s apartment buildings so heavily focussed on rental accommodation for overseas students, says Colliers national director of residential project marketing, Pete Evans.
“That’s evolving to cater for baby boomers and empty nesters looking for quality apartments with views close to amenities,” he says.
Evans points to recent developments in and around Newmarket such as St Marks, The Ivory and The Edgerley.
But while some of these new, quality developments have been high profile, he says they don’t typically deliver a very large number of apartments.
Just completed St Marks (pictured left) produced 58 apartments (only a couple still available), The Ivory and Edgerley about 80 apartments each.
So he feels it’s premature to look for big effects on surrounding suburbs’ property markets. However, Newmarket’s amenity will catapult when the redeveloped Westfield Newmarket opens in late 2019.
Evans says: “I think once it’s opened people will see it and like it, and then be saying ‘I want to be close or closer to this’.”
The $790 million redevelopment across multiple sites will include a rooftop lifestyle dining and entertainment precinct with views and cinemas, plus more than 230 new specialty shops, Auckland’s first David Jones, a new Countdown and new format Farmers.
