Just over half of the 45 currently tenantable office towers in Auckland's CBD and Wynyard Quarter were fully occupied, latest data shows. Photo: 123RF
Some commercial property investors and renters are rethinking where they put their money as the Reserve Bank's rate rises take effect.
Commercial real estate firm JLL's half-yearly review showed prime vacancies in Auckland's CBD have decreased 1.6 percent to 8.1 percent.
Average rents increased by $10 per square metre (psm), with the highest recorded rent more than $850psm in premium office buildings.
Head of research Gavin Read said competition for quality office space was high.
"Alongside these rent increases, we expect to see incentives for prime properties fall from 14.6 percent to 10.4 percent - the difference of about half a month's free rent," he said.
Read expected the lower end of the market would continue to face pressure as investors and renters prioritised higher-quality spaces.
"When completed we forecast an increase in vacancies in properties on the border of A-grade and upper end of B-grade assets, as more and more organisations compete to secure prime offices," he said.
Read said the figures showed just over half of the 45 currently tenantable office towers in Auckland's CBD and Wynyard Quarter were fully occupied, with vacancy across the city's five premium towers - HSBC Tower, Shortland and Fort, ANZ Centre, Vero, and PwC Tower - sitting at just 2.8 percent.