Christchurch industrial vacancy falls as market absorbs new supply

Christchurch’s industrial property vacancy rate has reduced slightly despite a record volume of new space entering the market, according to new CBRE research.

CBRE's Christchurch Property Market Overview report shows almost all the new industrial space completed over the past year has been occupied, pushing vacancy down from 2.1% to 2% overall.

Nearly 134,000sqm of new industrial space was added to the market during the second half of 2025 and the first half of 2026, resulting in high levels of net absorption, said Jorge Chang Urrea, Research Manager at CBRE.

“Of the 19 industrial buildings completed during the first half of 2026, 17 were fully committed. The vast majority of the new space was added in Hornby, followed by Rolleston.”

The most notable new assets were Mainfreight’s 26,500sqm facility at 23 Quadrant Drive and Fonterra’s owner-occupied 18,210sqm building at 13 Bruce Stewart Drive, both in Hornby.

The strong uptake illustrates a turnaround from 2024, when reduced consumer spending and economic challenges prompted some logistics firms to downsize their premises. Almost a quarter of the new space completed in the second half of 2024 remained vacant, in stark contrast to the healthy uptake in late 2025 and early 2026.

Hamish Clarke, Industrial & Logistics Director at CBRE, said established national occupiers are driving the high net absorption of industrial property.

“National logistics and warehousing operators have been consolidating from multiple smaller sites into new, larger facilities and Mainfreight is a notable example.”

Limited supply of land without building ties is still shaping the market, however new supply is in the pipeline. Future proposals consented through the government’s Fast-track Approvals Act consent process include Ngāi Tahu Property’s 60ha Pound Road industrial development and the Ryans Road 58ha subdivision in the Airport industrial precinct.

Nathan O’Neill, Industrial & Logistics Associate Director at CBRE, said there is investor activity in the market now and many vendors and buyers consider it a good time to be transacting.

“With the cost of money back on the upswing, vendors have decided to take assets to market, and purchasers recognise that conditions may change with the upcoming election and increasing interest rates so they have been looking to make acquisitions. Mid-market properties around the $10m value level have transacted very well in the first half of 2026, reflecting the pent-up demand from capital for quality industrial property.”

Demand remains strong for well-tenanted, good quality stock, with private and high net worth buyers the most active buyer group.

The record run of new development is forecast to continue through the rest of the year. Christchurch’s industrial market will grow by close to 142,000sqm in 2026 with the completion of 36 new buildings over 500sqm, mostly in Rolleston and Hornby, according to CBRE’s research. This is the largest annual new supply ever recorded and is almost double the average of around 77,000sqm a year during 2021 to 2025.