Warehouses remain the star of the commercial construction industry with the number of new warehouse/storage buildings consented in the third quarter (Q3) of this year hitting a 12 year high.
According to the latest figures from Statistics NZ, consents were issued for 155 new warehouse/storage buildings in Q3 2022, the highest number in any quarter of the year since Q3 2010.
The 155 new projects will provide an additional 256,525 square metres of floor space, bringing the total amount of new warehouse/storage space consented in the 12 months to September 2022 to 961,653 square metres. That's up 28% on the amount of new warehouse space consented in the previous 12 months.
The total estimated build cost (excluding land) of the 155 projects consented in Q3 was $340.6 million, which gives an average estimated build cost of $1328 per square metre. (A more detailed analysis of consents issued for office, retail, factory and warehouse projects in each of the main urban regions is available here).
Consents for new factories and other industrial buildings are also running hot.
Building consents were issued for 150 new factory and industrial buildings in the September quarter, the highest number in any quarter since pre-pandemic Q3 2019.
Those 150 consents will provide 135,325 square metres of factory floor space, which takes the total amount of new factory and industrial space consented in the 12 months to September this year to 474,628 square metres. That's up 16.5% compared to the pre-Covid total of 407,556 square metres in the year to September 2019.
Conversely, consents for new retail premises continue to slump, with just 45,156 square metres of new retail space consented in the the third quarter, down by 40% compared to pre-pandemic Q3 2019.
Office consents were middling in the third quarter, with just over 48,000 square metres of new office space consented. However the average estimated build cost was extremely high at $7397 per square metre, suggesting the projects consented were towards the upper end of the market.
Interest.co.nz's Commercial Building Consent Analysis Tables provide a more detailed quarterly analysis of commercial consents by region and building type, going back to 1991.
The comment stream on this story is now closed.
- You can have articles like this delivered directly to your inbox via our free Property Newsletter. We send it out 3-5 times a week with all of our property-related news, including auction results, interest rate movements and market commentary and analysis. To start receiving them, register here (it's free) and when approved you can select any of our free email newsletters.
6 Comments
That's a lot of space.
Indeed
This mimics what I've seen in the last 12-18 months, a real surge in expansion of factory and warehousing space, mainly in the agriculture sector.
Sad to see another story about an uptick in capacity for the "real" economy, and it generates almost no interest.
Nice summary Greg.
With the rise of working from home, demand for office space is shrinking.
Just shows how ahead of the curve Goodman were exiting the office asset class- including selling the Auckland VXV portfolio to Blackstone in 2018- to focus purely on logistics/ warehouse/ industrial.
New warehouse space is sorely needed, especially in Auckland.
As someone who leases a large warehouse my next rent review is expected to see over a 30% rise, over $200k rise in just 24 months. This will have to be passed onto my customers, inflation still has a long way to go from where I sit.
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.