The first half of 2016 has seen the highest value of commercial property sold in the first half of the year in Christchurch since 2007, according to the latest research published by CBRE.
CBRE’s New Zealand investment MarketView report for Christchurch, which covers transactions of $5million and above transactions of the first half of 2016, shows that a record-equaling 11 properties changed hands over the period, at a total value of $115 million.
The volume and number of sales surpassed the levels seen in the first half of 2015, and was only bettered in the first half of 2007, when an exceptional $300 million of property was sold. On a seasonally adjusted basis, the Christchurch investment market shows a clear growth pattern over the past three years.
Zoltan Moricz, Senior Director of CBRE Research, says that although first six-month sales totals have risen strongly since the low of 2011, the seasonal trend of sales volumes and values increasing in the second half of the year has been a distinct feature of the market over the last few years.
“The first-half numbers we are seeing this year are among the strongest we have seen. If the trend of stronger second-half-year periods is to continue, Christchurch could well see record volumes and values of transactions this year.”
Tim Rookes, Managing Director CBRE Christchurch, says that the numbers show that the Christchurch investment market is showing sustained transactional growth.
“The $5-$10 million range constitutes the bulk of sales we are seeing, but there is an increased prevalence of $10+ million sales in the numbers too, with five sales in the first half of the year with price tags above $10 million.
“In terms of the types of property that are being sold, industrial sales dominate with $46 million or 40% in sales volume, although the office and retail sectors were active, contributing 29% ($33m) and 22% ($25m) respectively to the sales volume.
“Local private investors were among the most active purchasers - while institutions are active in the market but remain net sellers.”
The largest sale during the period involved a suburban office complex at 335 Lincoln Road marketed by Tim Rookes, Merv Davies and Paul Brown for Cadaques Investments Ltd, which sold for $27 million to Viewmount Orchards Ltd. Two Countdown supermarkets sold as part of the SCA portfolio sell down of 14 Countdowns, purchased by Stride. An industrial property at 589 Halswell Junction Road sold for $11 million to a private investor and the Saunders & Co building at 131 Victoria Street also sold for $11 million.
Says Rookes: “Between 2007 and 2014, Christchurch’s average number of transactions stood at 10 per annum. In the last two years there were 22 transactions per annum on average. In the past six months, there were 6 transactions in the $5-$10 million price range, and 4 in the $10-$15 million price range.”
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