Christchurch CBD office vacancy reduces following major leases

Christchurch’s CBD office vacancy rate fell to 7.4% in the second half of 2025, down from 8.9% in the first half, marking the first decline in CBD vacancy since H2 2023. 

CBRE’s latest quarterly data on the local commercial property market shows the improvement came following several large leases which have absorbed previously vacant office space across the city. 

The lower vacancy reflects tenant moves including Seequent leasing 4,000sqm in the ex-IRD building on Cashel Street and Kiwibank taking 1,100sqm on level 4 of the One NZ building on Tuam Street (both deals negotiated by CBRE) as well as Mott MacDonald leasing 493sqm in the refurbished NZR Co Building on Hereford Street. 

Jorge Chang Urrea, Research Manager at CBRE, said the overall CBD vacancy rate has improved even as secondary (lower quality) CBD vacancy increased to 6.7% from 5.9%, driven by relocations that left behind backfill space in secondary-grade buildings.

Average prime CBD net face office rents remained stable at $415 per sqm in Q4 2025, while secondary net face rents increased 1.1% from Q3 to $368 per sqm. 

Mitchell Wallace, Associate Director of Office Leasing at CBRE Christchurch, said leasing momentum has continued to favour well-located, higher-quality premises as occupiers weigh up building performance, amenity and layout considerations.

Retail conditions remain mixed. Retail spending citywide in Christchurch decreased very slightly by 0.1% in the year ending November 2025, while central city retail spending fell 2.5%. 

However, retail rents in the CBD strengthened again in Q4 2025, reflecting the ongoing high demand from tenants for central city space. Prime CBD net effective retail rents increased 1.3% from Q3 to $1,026 per sqm in Q4.

In the industrial market, vacancy is still low. Industrial vacancy decreased slightly to 2.1% in the second half of 2025, from 2.2%. Industrial rents have remained stable since the third quarter of 2024, driven by lower levels of leasing activity and companies remaining in cost-reduction mode. 

CBRE expects industrial rents to remain stable in the coming quarters, with most of the new supply coming to market being owner-occupied.

In the investment market, yields were steady across most sectors in Q4 2025, with retail the main exception as several retail sub-sectors recorded firmer yields.  

Tim Rookes, Managing Director of CBRE’s South Island business, said higher investor confidence and lower interest rates are expected to lift transactional activity through 2026.

“Christchurch’s fundamentals continue to attract investor attention, with the market responding quickly when well-positioned assets come available. The Reserve Bank signalling that the monetary policy easing cycle is coming to an end will at least provide investors with some clarity that may help achieve more transparent market pricing this year.”