Tauranga’s commercial property boom is continuing on the back of an exceptional year
All five properties in Tauranga, Mount Maunganui, Te Puke and Taup sold at the latest Colliers International auction on Friday for a total of $10.9 million.
Colliers International Tauranga Managing Director Simon Clark says the result sends a clear signal that the market remains buoyant.
“Investors have been looking for guidance on the mood of the commercial property market, following a buoyant and active period of activity last year. They wanted to know if the market had cooled.
“The good news from Friday’s auction is that the market is as strong as last year, maybe even stronger. I haven’t seen activity like that in the auction room, over a broad spectrum of properties, for quite a number of years. It’s very positive for 2017.”
Tauranga is in the midst of a commercial property boom, with last year one of the strongest for sales. Colliers International and CoreLogic research shows there were around 221 transactions worth $283 million in 2016, up from 158 transactions worth $232m in 2014, representing 22 per cent sales growth.
Clark says investor demand and inquiries have been as strong this year as the height of the market last year. “Certainly the confidence is still there – and buyer demand is still there, too.”
Bidders at the auction weren’t at all affected by recent interest rate rises, Clark says. “There are still a lot of cash buyers from all over the country looking for better than bank returns.”
Clark says Tauranga continues to be attractive to out of town investors, with about half the bidders on Friday coming from outside of the region.
“That’s pretty unusual for Tauranga and shows there confidence in this region,” he says. “We had three or four telephone bidders from out of town that really pushed the prices higher.”
The highest price at auction was $2.85m for Countdown Te Puke’s prominent site at the corner of Boucher Avenue and Queen Street.
The 2,061sq m freehold site, plus 1,311sq m on lease from the council, was marketed by Clark, Mark Brunton and Rob Schoeser of Colliers International.
It was the first time the 1,167sq m supermarket had been placed on the market since opening as a Woolworths in 1995. The sale represented a yield of 7.4 per cent.
A 1,644sq m industrial corner site at 42 Hewletts Road, Mount Maunganui, sold for $2.56m, representing a yield of 5.15 per cent. The two cross lease titles, with option to freehold, were marketed Clark and Schoeser.
A multi-tenanted 1,747sq m industrial property at 76 Koromiko Street, Tauranga, sold for $2.16m, representing a yield of 5.8 per cent. The freehold property was marketed by Clark and Rich Davidson.
A 2,703sq m industrial property at 75 Aviation Ave, Mt Maunganui, sold for $2.06m, representing a yield of 5.3 per cent. The freehold property was marketed by Clark and Schoeser.
A 501sq m freehold property in Taupo, housing a 307sq m bar and restaurant, sold for $1.25m. The sale of 22-26 Tuwharetoa Street, brokered by Clark and Mark Rendell, represented a yield of 6.8 per cent.
