Investor confidence in commercial property has hit a two year high, with Tauranga and Mt Maunganui beating Queenstown to first place for the first time in almost four years, according to a new survey from Colliers International.
The real estate company’s latest quarterly survey saw investor confidence reaching a net positive 26% in the December 2018 quarter; Tauranga/Mt Maunganui came out in first place with a net positive 57%, with Queenstown following on with a net positive 46%. The resort town slipped to second place after having held the top spot for the last 15 consecutive quarters.
Queenstown maintained its ‘two year reign’ for price growth expectations however, with a net positive 49.8% of respondents anticipating an increase in median price over the next year. It has remained in first place since December 2016, when the figure was a net positive 75.8%.
According to Colliers, the results show a “major commercial property boom” for Tauranga and Mt Maunganui, with the results promising a solid level of ongoing growth.
“There’s record low vacancy across all the key commercial sectors – office, retail and industrial – which is driving down yields and pushing up rents,” said Simon Clark, managing director of Colliers International Tauranga.
“Investors see Tauranga as being more affordable than Auckland but offering equally strong fundamentals and returns.”
When it comes to Queenstown, Colliers says the overall outlook remains positive – however, the key trend this quarter was a slight dip in optimism.
“Queenstown was among eight of 12 regions to record a decline in the proportion of respondents expecting median prices to increase when compared to the previous quarter,” research and communications director Chris Dibble said.
“While sentiment in Queenstown is still overwhelmingly positive, it is down 10.4 per cent from a net positive 60.2 per cent in the September.”