A property boom at Whangarei Heads could be the reason for a new storage facility being built in Onerahi, which locals say is a welcome development in the city suburb.

Construction has started at the Old Onerahi Rd site, behind the police station, for the new indoor storage facility with capacity for up to 150 storage units.

According to the Whangarei District Council's consent document, the facility would be divided into three blocks and have a boundary fence and within that, a 2.2-metre high electric security fence around it.

LJ Hooker realtor Adrienne Battersby said there is a property boom at the Heads, with retirees from across New Zealand snapping up the coastal properties.

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She said she could see that, in light of the burst of interest in property, there would be a need for storage in Onerahi, from furniture to boats.

She has worked in real estate in Whangarei Heads for nine years and said houses usually sell in summer. "But I've been selling all through the winter."

Tony Collins, Chamber of Commerce Northland executive, agreed that the growth in the area would result in a need for more storage. "This is a key piece of infrastructure. You can see with the amount of traffic ... there has been growth out there."

One use for the storage units, he believed, would be for those who had moved to the Heads and required units.

He said the recent refurbishment and rebranding of Flames Hotel could be seen as another sign of change in the suburb.

The development was being completed by Guyco Construction and under Rosemorn Industries, both headed by Greg Guy, who owns the Strand and Civic arcades.

Mr Guy declined to comment on the project.

The 0.74 ha site was on Business 3 Environment zoning, and planners said the development would "support the existing service function of the existing Onerahi Shopping Centre".

Business 3 Environment zones include shopping centres outside the CBD and business areas near residential zones.

According to WDC rates records, the site had a capital value of $5 million and a land value of $4.85 million.

The consent document outlined that the centre could open from 7am to 7pm for clients to access units, with the fence only being live while the facility was closed.

Onerahi Community Association chairman Nick Connop said he was pleased with the development and it was a good use of the space.

He said Onerahi still needed further development, such as the addition of a cafe or restaurant, a drop-in youth centre and a second-hand store.