Rents lift for suburban retail property

In the Auckland suburban retail sector, where many mum and dad investors have holdings, average prime rents rose by $25/m2 or 2.7% in the first quarter of this year after remaining unchanged since early 2021, and now stand at $950/m2.

Although vacancy is expected to drop, backfill of existing vacant space needs to be occupied, in order for rents to start increasing, so further increases are not expected this year. 

Another factor stabilising rents is many smaller scale retailers developing their online shopping platforms, and do not need additional retail space for their business to grow.

Suburban vacancy dropped to 9.4% from 11.9%, signifying more than 5,000m2 of space being leased in the first quarter across multiple locations.