The amount of new warehouse space consented in Auckland hit a record high in the September quarter (Q3) this year.
According to Statistics NZ's building consent data, 197,398 square metres (sqm) of new warehouse and storage buildings were consented in Auckland in Q3, which was the most new warehouse/storage space consented in the region in any quarter since Statistics NZ began compiling the figures in their current format in 1990.
The value of the building work involved was estimated at $252 million, excluding the cost of the land and other non-construction-related costs, which was the first time the value of building work on warehouse/storage buildings in Auckland has topped $200 million in any quarter.
According to Interest.co.nz's Commercial Building Consent Analysis tables, the average size of the new buildings consented was 5483 sqm, and the average estimated build cost was $1277per sqm.
That pushed the total amount of new warehouse/storage space consented nationally in Q3 out to 289,600sqm, also a record high.
The surge in the amount of warehouse space consented comes after two quarters in which an unusually low amount of new warehouse space was consented. So with demand for warehouse space still running high, there was probably a bit of a catch up in the latest figures (see graph below).
Construction of new factories and industrial buildings in Auckland is also running hot, with 42,334sqm consented in Q3.
Although that's not a record it is very high and the value of that building work was a record high at $159 million.
By comparison the amount of new office and retail premises consented in Q3 was relatively subdued, with 30,450sqm of new office space at an average estimated construction cost of $5841 per sqm, and 34,227sqm of new retail premises at an average estimated construction cost of $2935 per sqm.
The full analysis of consented work for office, retail, factory/industrial and warehouse/storage buildings, nationally and in each of the main urban areas, can be found in our Commercial Building Consent Analysis Tables.
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8 Comments
Looks like just a catchup for two quieter periods prior. I.e. average the last three periods and things are not healthy ... not healthy at all ... Much like the rest of construction sector.
- Auckland is an outlier, regions doing it tough
- Auckland record, national record is 2022/Q2 of $392 million
- Bit of statistical smoothing and ... Nothing to see here.
*Hmm .. Auckland's needs additional warehouse space? ... Does that mean the Port, or a port will be here for much, much longer?
I reckon there is a lag. Inventories were massive due to covid disruptions and warehouse space was at a premium and commanding big dollars. Not the case now, Inventory volume is heading south pretty rapidly as logistical issues have completely subsided.
Some businesses have and are growing though. We just focus on the averages, but contraction and expansion, inflation and deflation, etc, are happening at the same time (albeit at different proportions obviously).
Warehouse requirements should continue to grow, as the market for online retailing changes the physical requirements for retailers (less storefront square meterage and more storage requirements).
Getting a warehouse consented takes longer than a house often by quite a bit, so some of this was likely first floated 18 months ago.
And there’s plenty of speculative behaviour around securing consents in the commercial sector, just as there is in residential
Mmm, the cost is usually quite a bit higher just to have a sniff.
We deal with 3 different 3pl providers, there's plenty of space out there now compared to 12 months ago. Rates are far more competitive.
I'm working on some, they're either related to manufacturing (production demand has exceeded storage of raw materials and finished products), or to try and increase local inventory holdings to overcome supply chain bottlenecks.
They're all operator owned (so not for leasing).
Massive Ikea warehouse in Mangere would have been consented during this time period.
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