AUCKLAND INDUSTRIALCOLLIERS ESSENTIALS | 2H 2018Market Snapshot - 12 Month Comparison

Source: Colliers International Research

Auckland Industrial Net Rental

Whilst all care has been taken to provide reasonably accurate information within this report, Colliers International cannot guarantee the validity of all data and information utilised in preparing this research. Accordingly Colliers International New Zealand limited, do not make any representation of warranty, expressed or implied, as to the accuracy or completeness of the content contained herein and no legal liability is to be assumed or implied with respect thereto.

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The number of Auckland industrial building consents increased by 17 percent to 207 in the year to 2018, which is backed up by a wave of speculative builds. Consents by value increased 17.3 percent, principally a reflection of escalating construction costs.

Warehouse rental growth shows no sign of slowing down at least in the short-term, primarily due to the lack of supply and the sharp reduction in secondary vacancy, limiting tenant options.

In September, Foodstuffs’ 13.12ha distribution centre in Mt Roskill, Auckland sold for $93 million. This represents the largest singular asset industrial transaction on record in New Zealand.

Investor confidence for the industrial sector was the strongest across all the commercial and industrial sectors with a net positive 58% (optimists minus pessimists), according to the latest Colliers survey.

SUPPLYUnder Construction206,933m2

Proposed (to 2023)132,134m2

VACANCYPrime1.3%

Secondary1.9%

AVERAGE WAREHOUSE NET FACE RENTS ($/M²)

$119 $97$140 $115

Prime

Prime

Prime

Secondary

Secondary

Secondary

AVERAGE YIELDS

4.9% 5.7%6.0% 6.8%

AVERAGE NET CAPITAL VALUES* ($/m2)

$2,370 $1,688$3,453 $2,381

Auckland Industrial Vacancy – By Precinct

Financial data based on September 2018 and physical data based on August 2018. Face rents, yields and capital values are based on averages across all precincts. Figures exclude buildings in the development pipeline. *Based on net face combined rents.

L H

L H

L H

L H

L H

L H

$75

$85

$95

$105

$115

$125

$135

Sep-

13

Sep-

14

Sep-

15

Sep-

16

Sep-

17

Sep-

18

Net F

ace

War

ehou

se R

ents

($/

m²)

Prime Secondary

0%

1%

2%

3%

4%

Over

all

Oneh

unga

/Pe

nros

e

Rose

bank

/A

vond

ale

Mt W

ellin

gton

Airp

ort C

orrid

or

Man

ukau

/W

iri

East

Tam

aki

Mai

rang

i Bay

Nor

th H

arbo

ur

Wai

rau

Valle

y

New

Lyn

n

Hen

ders

on

Vaca

ncy

Rate

Aug-17 Aug-18

The overall Auckland regional industrial vacancy rate reached 1.7 percent in August 2018, the lowest level ever recorded in the 23-year history of the survey.

16

18

20

NO

RTHERN MW

Y

UPPER HARBOUR M

WY

SOUTH WESTERN MWY

NO

RTH WESTERN MWY

Mairangi Bay$650 $133

5.3% 2.1%

East Tamaki$550 $130

5.4% 0.9%

Manukau/Wiri$538 $130

5.4% 1.4%

Mt Wellington$600 $130

5.4% 0.0%

North Harbour$600 $133

5.3% 0.1%

Wairau Valley$700 $133

5.1% 2.2%*

Henderson$475 $125

6.0% 2.4%

New Lynn$475 $125

6.0% 3.3%*

Rosebank/Avondale

Penrose/Onehunga$600 $130

5.4% 0.0%

Airport Corridor/ Mangere

$538 $123

5.4% 1.7%

Auckland CBD

17

Source: Colliers International Research*Overall Prime and Secondary

KEY

Prime Avg Land Values ($/m2)

Prime Avg Warehouse Net Face Rent ($/m2)

Prime Avg Market Yield (%)

Prime Vacancy Rate (%)

Annual Change

32-38 PATIKI ROAD, AVONDALE UNDER CONSTRUCTION | Q4 2019 JAMES KIRKPATRICK GROUP

GATEWAY WAREHOUSES 106-162 HIGHBROOK DR, EAST TAMAKI UNDER CONSTRUCTION | Q4 2018 GOODMAN PROPERTY

SELWOOD UNITS 5-11 SELWOOD RD, HENDERSON UNDER CONSTRUCTION | Q4 2018 GOODMAN PROPERTY

FOR MORE INFORMATION:

Chris DibbleDirector Research & Communications

Greg Goldfinch National DirectorIndustrial Sales & Leasing

Elena Christodoulou Research Analyst

Emily Duncan Research Analyst

Josh LeeResearch Analyst

Colliers InternationalLevel 27, SAP Tower

151 Queen St, Auckland +64 9 358 1888

Market Indicators by Precinct

216 ROSCOMMON RD, WIRI UNDER CONSTRUCTION | Q4 2018 HUGH GREEN GROUP

$550 $130

5.5% 1.7%