Go to Wellington young professional; the property market is reinforcing it as the place to be

Posted on Thursday, November 19th, 2009 at 3:01 pm in

A recent survey by top head-hunters advised degree-ed professionals in their early 40s to head for the Capital. Yes, Wellington; not Auckland.

Bottom-line would seem to be that there is more value attached to “Government work” than what goes on in Auckland. Or perhaps it is easier to screw a buck out of the ‘pollies’ than the entrepreneurs?

That research followed in the wake of last year’s Government buy-up of office space in Wellington, which drove prices to heady heights.

The latest Bayley’s Research shows:

“Vacancy rates for Wellington CBD office have continued to drop as tenant demand has increased uptake of space across the CBD, according to the June 2006 Office Space Market Survey figures released by TelferYoung. There was a 0.79% decrease in vacancy in the half year to December 2005 and a further 1.08% decrease in the first half of 2006 to 7.1% overall vacancy.

The Wellington CBD had a gross take up of over 157,000 metres square (m2) of space in the year to June 2006. The declining vacancy was assisted by the further removal of some building from the survey which are “off market” for the time being and undergoing renovation.”

There is supportive news on the Wellington economy in the Bayley’s report on the commercial front too.

“The Wellington industrial property market has been running hot over the last five years with the market initially dominated by investors. As rental levels increased, however, occupying tenants looked to insulate themselves from increasing occupation costs and benefit from capital appreciation, by purchasing property themselves.

The strength of the economy has generated strong tenant demand for space which has driven down vacancy rates and continued to encourage investors to compete for property, driving down yields. While many analysts have predicted a slowing of the economy, the impact of this has yet to be seen in the Wellington industrial market as illustrated by the success of the three different suburbs.

The refurbishment of a functionally redundant building at Randwick Park, the development and sell down of self-contained industrial units in Grenada and an industrial subdivision at Seaview have all attracted strong interests.

While vacancy levels have reached historic lows in a number of Wellington’s industrial precincts, building owners have found it difficult to lease premises which no longer meet current industrial specification, in particular properties with low stud heights.”

Possibly not able to cope with the expanding heads of the young professionals who are presumably arriving in droves!