New Zealand’s COVID-19 recovery has seen a huge demand for industrial, manufacturing and logistics development sites. This has elicited a significant response from the development sector, with Stats NZ building consent data showing for the year to October 2020 record highs in Waikato, Gisborne, Hawke’s Bay and Southland. A notable exclusion from this list being Auckland, where the squeeze on land is hampering development opportunities. Resulting in further upward pressure on land values, especially in established precincts.
This substantial increase in land prices, combined with the increase in construction costs, resource management timeframes and code of compliance issues means many of our development clients are looking at other uses for former industrial sites, such as bulk retail or office buildings. Further increasing the shortage of traditional basic warehousing premises.
The shortage of development sites zoned industrial has resulted in local government being put under pressure to rezone land, with future greenfield development likely requiring industrial precincts to be formed.
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