The tide is turning in Tauranga's CBD as out-of-town investors vie for commercial property and pump millions of dollars into the city, business leaders say.
The increasing interest is not just coming from around the country - with one agent saying about 33 per cent of his transactions last year were to Chinese investors.
Last month, Colliers International Tauranga brokered a $40 million deal to an investment group from Queenstown that bought Trustpower's new building in Durham St from Zariba Holdings.
A spokesperson for the owners of the Trustpower building said they wanted to invest in growth regions like Tauranga - particularly quality buildings with secure rental incomes - and they had another $20 million complex under contract.
Zariba managing director Dwayne Roper said he believed the development was a turning point for the city.
"With new investment pouring back into the downtown area and the construction of the new university campus starting next year, we own other sites in the CBD and are keen to be involved with its revitalisation."
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Colliers International Tauranga managing director Simon Clark said the CBD was moving in the right direction and "it's great to see out-of-town investors that have confidence in our CBD".
The number of vacancies downtown, particularly in retail sector, did not look great but "the tide has turned and there is growth in the office market".
About 50 per cent of Colliers' inquiries were from out-of-town investors and 5 to 10 per cent of those came from overseas, he said.
In 2015, Colliers International Tauranga's's total commercial sales jumped to $115 million from $75 million in 2014, and Mr Clark said they expected that to climb this year. He also predicted investment from Asia would continue to grow once the new university was built.
Ray White Commercial Tauranga leasing and sales team leader, Philip Hunt, said there was substantial development coming on-stream in the CBD following a period in the doldrums, which "is quite exciting".
Mr Hunt had experienced a huge lift in investment inquiries and purchases from Chinese investors, he said.
"It is quite amazing the amount of investment money coming into Tauranga from that community. I can tell you it has certainly lifted my business by nearly a third last year and the number of transactions is heading to the 20s or 30s, which includes sales and some leasing."
Bayleys commercial manager Richard Graham said growth had been phenomenal with the year-to-date sales up 73 per cent and "in the foreseeable future I think we can expect more of that".
A Government agency had taken the majority of the lease at 306 Cameron Rd - a 8000sq m development that would be in the region of $40 million when sold down - and 40 per cent was already accounted for, he said.
"That is really going to drag additional businesses into the CBD."
Meanwhile, a lot of businesses were looking to relocate so a number of developers "are looking to demolish older buildings and possibly build brand-new, state-of-the-art premises which would be a mixture of retail, office and in one case some inner-city apartment options".
A lot of interest had also been generated from businesses looking to come out of Auckland and Waikato that were looking for good-quality premises in the CBD, he said.
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Carrus managing director Paul Adams said it had purchased the existing building at 53 Spring St (former ANZ commercial bank) to redevelop into a high-rise commercial space.
As a developer and supporter of the city, Mr Adams said, "We have decided we need to be seen to be involved in this redevelopment, rather than just complaining about the lack of council action in revitalising the city centre and the environs and creating the lacking civic amenities."
Mr Adams, who is also the Civic Amenities Group chairman, added: "Having national and international purchasers investing in Tauranga will create the competition required to ensure quality building development, which in turn will attract more businesses and quality tenants to Tauranga, whilst creating the competitive tension required to add value to these new CBD commercial investments."
The city must strive to retain and bring back commercial tenants into the CBD, as revitalisation and creating a heart to the downtown area is about drawing people into this space.
Property Managers Group chief executive Scott McKenzie said it was continuing to receive a steady stream of inquiry from New Zealand-based investors looking for the improved returns that commercial property can offer against current bank deposit rates.
"We have also noticed growing interest from global investors with reasonable financial means and the desire to build a portfolio/s in New Zealand given global volatility and the search for security."
Bay of Plenty Chinese Business and Commerce Association chairwoman Candy Yang said she did not have a lot of information on investment into the CBD but Tauranga was attracting investors from China and other cities in New Zealand.
Its business group had about 120 members and often Chinese migrants started their own businesses, she said.