October 2021 - January 2022
COMMERCIAL PROPERTY
Capital T markets investment outlook Despite the latest Covid-19 outbreak, investor confidence is expected to remain strong, JLL Head of Research Gavin Read says Key investment trends entering 2022 Office Office investor demand remains stable, however there is a divergence in grade and location from both an investor and occupier perspective. Industrial Industrial and logistics will continue to be a sought-after asset class, with the majority of developments being pre-leased. Retail Despite strong retail spending, investors remain cautious towards discretionary retailing and lean towards non-discretional retailing. Alternatives Interest for alternative assets such as medical centres, data centres, aged care, hotels and cold storage are picking up, plus Build to Rent. Tenants Tenant covenant strength is increasingly more important for investors with investments made on caseby-case basis. Reposition There is increasing demand for reposition opportunities for value add strategies in strategic locations. ESG Investors are also increasingly conscious of the importance of ESG in their investment decisions and strategies. 8
propertyandbuild.com
he resilience of the country against Covid and stronger than expected economic recovery has seen an uplift in investor interest for New Zealand's real estate market. While it is uncertain how long the latest Delta-related lockdown will last, investor confidence is expected to remain strong and the existing transaction pipeline continues to progress with minimal impact on investment decisions, particularly for those assets with strong tenant covenant. All sectors (inclusive of traditional and alternatives) have been sought for direct investment across the
country, with powder remaining dry from a tentative approach throughout 2020. Although some sub-sectors struggled, others have thrived, with investors focused on placing capital into trending sectors with long term growth and stability. New Zealand’s long-term outlook remains positive for investors. It is still a favourable destination for capital on the back of the long-term economic and population story remaining positive. Between 2020-2030, New Zealand population growth is forecasted to be 0.88% per year, while average GDP growth is expected to
