Commercial refurbishment sign of confidence

Scaffolding and boxing is a common sight across Dunedin’s retail and office sites as shops on Princes St (1), Filleul St (2), the Octagon (3, 4), St Andrew St (5), Moray Pl (6), Great King St (7) and George St (8, 9) are being refurbished. PHOTOS: GERARD O’BRIEN

Work has recently begun at commercial sites throughout Dunedin’s central business area.

In the last quarterly count of George St block retail vacancy, in May, from Adam Binns Commercial, vacancy was down 1% across the area to 11% of all shops.

Across the central city there were five new occupancies, which included three new tenants and two relocating from other sites, a further two new retailers who replaced previous occupiers, and four new vacancies.

Colliers International commercial agent Dean Collins said the commercial property scene in Dunedin had grown busy and previously vacant sites were starting to "lease up".

"Covid probably caused a bit of a bump in the road but Dunedin as a whole seems
to be going pretty well," he
said

There was a "good" number of lease transactions happening around the city, which was a mixture of new businesses and existing tenants who were looking to move into something bigger, Mr Collins said.

That was giving commercial property owners confidence in the Dunedin market.

"Office and industrial spaces have carried on well but retail probably was always lagging behind.

"But it will absolutely be giving confidence seeing new leases come in," he said

Edinburgh Reality commercial consultant Merrin Bath said retail leasing was a challenging market at present.

Retailers were requiring a high standard of structural integrity with buildings and Covid-19 had an impact on retail turnover, she said.

"Landlords very generously offered tenants rental concession through that period so we didn’t see businesses closing.

"What we are seeing in the office renting space is businesses revisiting the way they work and being more flexible and some staff are still working from home.

"What that has meant is that some businesses are freeing up some of their footprint, which has meant more office space coming on to the market," Ms Bath said

Bayleys Metro commercial agent Robin Hyndman described the Dunedin commercial market as "steady".

There was not a lot of property for sale but good commercial property, with good tenants, that was well located, was always in demand.

The Dunedin market had pulled through well, following the impact of Covid-19, he said.

"Offices are quite steady and industrial is also steady, so things are going well."

A lot of commercial buildings in Dunedin were undergoing seismic strengthening, Mr Hyndman said.

There were always a lot of inquiries from new businesses, national and international, which were looking to move to Dunedin, he said.

riley.kennedy@odt.co.nz