Record contest for Hamilton industrial space as city booms

Hamilton's industrial building stock was roughly a seventh of the size of Auckland's industrial market and Te Rapa (picture) is one of its largest areas for these types of properties. / NZME

New, high-quality Hamilton industrial property space filled up last year as fast as it was built, with squeezed-out Auckland companies contributing to a record low vacancy level.

An annual survey of Hamilton industrial property occupancy by CBRE and NAI Harcourts showed strong occupier activity last year with demand particularly high for new quality space, most of which was at the city's northern gateway.

Overall industrial vacancy sunk to a record low 1.5 per cent, representing a nearly 13,000sqm reduction in vacant space in the 12 months to end December, said the survey report.

This despite more than 61,600sq m extra space being added to the city's stock, mostly due to completion of new, fully occupied, Grade A buildings in Te Rapa North and increased leasing of Grade C space in Frankton and Te Rapa South.

Nineteen new developments were under construction at the time of the survey, representing more than 25,000sq m of industrial stock in the pipeline.

The survey showed monitored building stock in Hamilton city measured 1.68 million sq m, a net increase of more than 49,000sq m in the year to December. Hamilton's industrial building stock was roughly a seventh of the size of Auckland's industrial market, the survey report said. Frankton remained the largest industrial precinct ahead of the two Te Rapa areas.

The report's authors said with Auckland's industrial market showing an extremely tight 1.3 per cent vacancy level, Hamilton, particularly the northern industrial region, was likely benefiting from the spillover effect.

Ongoing development of transport infrastructure between Hamilton and Auckland also suggested further benefits for the Hamilton market, said the report, which noted three more growing industrial markets outside the survey zones. Industrial precincts at Hamilton Airport, Northgate at Horotiu and the emerging Ruakura inland port had all seen significant growth last year.