Colliers International annual CBD office report said seismic concerns around the country remain the main concern of landlords and tenants alike, with A-grade premises around the country becoming more attractive.
Under new building standards, buildings must reach a minimum 35% compliance in earthquake-proofing, which is driving out some tenants to higher rated buildings and leaving owners to consider expensive strengthening projects.
Colliers manager in Dunedin of commercial and industrial sales and leasing, Dean Collins, said when contacted Dunedin was ''historically short'' on providing new office space.
The A-grade premises were now in greater demand, given the level of older historic buildings around the city, he said.
''National and international tenants can't be in earthquake-prone buildings. They will leave those premises,'' he said.
The move by Silver Fern Farms to Dunedin's former chief post office in Princes St had left about 3000sq m of office space at its former site, in Harvest Court in George St.
However, Mr Collins said the more than $6 million redevelopment of Harvest Court ''would go some way'', to alleviate the A-grade shortage in the city.
He said there would be seven new tenancies created, ranging in size from 50sq m to 1000sq m at Harvest Court, which is expected to be completed by the end of the year, or early next year.
''This will definitely help accommodate the shortage; Dunedin's not a place for new builds in recent years,'' he said.
He highlighted there was increasing tenant interest in historic building redevelopments, such as the 85-year-old Public Trust building in Moray Pl which has had almost $3 million spent on it so far.
The Public Trust building has more than 80% occupancy and its earthquake rating stands at 80% compliance, but is targeting 100% when completed.
Similarly, Van Aart Sycamore Lawyers is increasing the seismic strength of its recently acquired historic Bank of New Zealand building in Princes St, seeking to push up compliance from 67% to 100% while it is being renovated, and new offices fitted out.
Alan McMahon, Colliers' national director of research and consulting, said in the report that competition between Christchurch's key landlords was heating up, as tenant demand became more defined.
''There is about 55,000sq m of new CBD space required by private sector corporate tenants returning to the CBD,'' Mr McMahon said.
That was not counting a further 25,000sq m of office space being sought by 18 government agencies, he said.
In Auckland, leasing activity had been ''robust'' because of businesses staying put and others' expansion, which was mainly driving the market.
While overall occupancy was down from 10.5% to 9.9%, A-grade vacancies were expected to be below 7% for the remainder of the year, Mr McMahon said.
