Low interest rates encourage own-your-own trend in industrial premises.
Strong demand for vacant premises, particularly from owner-occupiers, is contributing to the fall in industrial property vacancy rates in Auckland.
Mike Adams, Bayleys Auckland industrial manager, says the low interest rate environment often means businesses can borrow to buy premises at a similar cost to renting.
"Owner-occupiers have taken advantage of the low borrowing costs and attractive prices that have prevailed over the past few years to acquire a significant number of vacant buildings, particularly in the sub-$1 million sector of the market.
"This, along with a steady pick-up in tenant demand, has resulted in vacancy levels falling across the region. We are also now seeing some businesses buying their own premises to protect themselves against the inevitable rental increases that will result from vacancy rates decreasing further.
"There is a paucity of good quality industrial investment property for sale and an improving market is also resulting in more investors buying well-located vacant or semi-vacant buildings with a view to leasing them."
Recent sales of vacant buildings Bayleys has been involved in include:
Unit B, 13 Piermark Drive, Albany: A 716sq m unit comprising a warehouse of 413sq m plus 303sq m of office space with 13 carparks was sold vacant for $1,330,000 by Laurie Burt of Bayleys North Shore Commercial.
20 Hillside Rd, Wairau Valley: A 605sq m refurbished older style industrial with a 50/50 warehouse to office and showroom split on a site of 1619sq m, with 10 carparks, was sold for $973,000 by Greg Healey, Bayleys North Shore Commercial.
360 Rosebank Rd, Avondale: A 517sq m building with 468sq m of warehouse space and 49sq m of office on a 1057sq m site was sold for $885,000 by Grant Miller of Bayleys Auckland.
119 Mays Rd, Onehunga: A 683sq m building that has a 600sq m warehouse and 83sq m of refurbished offices, on an 863sq m site with minimal carparking was sold for $695,000 by James Valintine and James Hill of Bayleys Auckland.
5 Mountjoy Place, Onehunga: A 480sq m building with 392sq m of warehouse space, 98sq m of office space plus a 80sq m yard on a site of 722sq m was sold for $575,000 by Valintine and Hill.
Unit 5, 29 Hannigan Drive, Mt Wellington: A 323sq m modern industrial unit consisting of 140sq m of warehouse space, 79sq m of office, and a 57sq m showroom plus amenities, was sold for $510,000 by Valintine.
Unit A, 22 Greenpark Rd, Penrose: A 775sq m premises made up of 713sq m of warehouse space with 62sq m of office space, and 15 carparks was sold for $890,000 by Hill and David Gubb of Bayleys Auckland.
Unit C, 2 Greenmount Drive, East Tamaki: A 650sq m premises made up of a 442.5sq m warehouse, and a 208sq m office and showroom, was sold for $1,080,000 by Katie Wu and John Bolton of Bayleys Manukau.
Unit D, 150 Harris Rd, East Tamaki: A 344sq m unit consisting of a 260sq m warehouse, and 87sq m showroom and office, was sold for $643,000 by Katie Wu and John Bolton.
Unit I at 9 Lady Ruby Drive, East Tamaki: A 268sq m unit comprising a warehouse of 222sq m and office of 46sq m was sold for $438,000 by Wu and Rob Farmer of Bayleys Manukau.
22 Oakleigh Ave, Takanini: A 250sq m vacant half-round shed on a 1159sq m flat and fully fenced site was sold for $400,000 by Peter Migounoff of Bayleys Counties.
Industrial property sales
Reported by: Bayleys
Feature: Big demand for vacant premises
Why: Low interest rates, protection against rent hikes
Impact: Falling vacancy rates.