A new mixed-use development in Pāpāmoa has almost doubled in value as demand for commercial space in the suburb soars.
The now sold-out Pāpāmoa Junction on Parton Rd in Pāpāmoa East is estimated to be valued at $200 million once complete. Its original valuation was more than $100m.
The news comes as Tauranga City Council has issued commercial consents worth nearly $33m in the Mount and Pāpāmoa area in the past six months.
Pāpāmoa Junction will include 25 per cent high-density residential with the rest being retail and office space as well as light industrial supply.
Scott Adams, managing director of Carrus, which bought the 8.46-hectare site in 2009, said there had been "big interest" from owner/occupiers and investors with all 43 sites at an average 1300sq m sold.
"Papamoa Junction is zoned commercial, which means it can cater for a wide range of activities such as office, retail, trade supply, medical, medium and high density residential and light industrial.
He said it benefited from its position between the beach and the Tauranga Eastern Link motorway and had schools and childcare centres nearby.
Adams said with Pāpāmoa's residential sector growing at a "phenomenal pace" and traffic congestion at an all-time high, it was time to provide a mixed-use development.
"The pleasure of convenience to be able to work close to where you live without having to drive long distances is becoming more desirable as is witnessed at The Lakes and Tauriko Business Estate at a much larger scale."
All subdivision titles were expected to be completed by the end of the year, he said.
Colliers International Tauranga managing director Simon Clark said all 43 sites at Pāpāmoa Junction had been sold to mostly local investors or corporate developers.
"We've sold the land and now we're selling the buildings. It's going to be a real mixed-use development."
The project's total value had jumped to $200m from $100m because a lot of multi-storey buildings were now being built in the complex.
Clark said there was an underlying trend where people now wanted to live and work close together.
"Pāpāmoa is getting to a scale where new businesses are much more viable as the population grows."
Zaha Capital's initiative called The Hatch had bought 24 units in Pāpāmoa Junction to sell on. Of those 15 had sold and nine were still available.
Tyler Tabak of Zaha Capital said traditionally commercial property in Tauranga, Mount Maunganui and Pāpāmoa had been unaffordable for new entrants to the market.
"The Hatch is high-quality small-format commercial property targeted at owner/occupiers, investors, and new entrants to the commercial market.
"The smaller nature of the units makes them affordable to new investors and small to medium businesses to own their own premises."
Tabak said the Bay's strong population growth, particularly in Pāpāmoa, brought with it new commercial opportunities and the region was seen as a "lifestyle location" for new residents.
"This type of property caters well to small business and the self-employed. It's close to the beach and schools and situated in Pāpāmoa's newest commercial subdivision Pāpāmoa Junction."
Tauranga City Council's latest building consent report showed there were 32 commercial consents worth more than $120m issued in March. That included 11 commercial consents worth nearly $8m issued in the Mount Maunganui/Pāpāmoa area.
Council's building services manager Steve Pearce said last month, the council issued consent for the construction of a large new industrial building at 1 Te Kakau Pl.
"This development is worth over $4m and alone makes up half of the value of consented commercial developments in the Pāpāmoa/Mount Maunganui area last month."
Pearce said in the past six months, the council had issued 48 consents for commercial building in the Mount/Pāpāmoa area, worth nearly $33m.
"Across the city, for that same period, we issued 131 consents for a combined value of $288m.
"It is great to see some big commercial developments happening in our city and hopefully in time, we'll get to see all the benefits of these flowing through to the city."
Medical hub's $9m extension
Meanwhile, a $9m extension to a Pāpāmoa medical hub is under way and is expected to create between 50 and 60 jobs.
Developer Daryl Scott is extending its $7m medical hub, which includes a medical centre, physio and pharmacy, on the corner of Parton and Tara Rds.
"The medical hub has been received really well. It is bursting at the seams, a lot of those businesses are doing really well."
So Scott said the centre was expanding to include a large gym, radiologist, dentist/orthodontist and boutique bread shop. It would be a $9m build, he said.
"It's all about servicing that local area."
The expansion project was about 70 per cent tenanted already.
"We're looking for two more quality tenants - and we're probably about a quarter of the way through construction," he said.
"It will probably employ about 50 to 60 people as far as jobs and about 25 jobs at the peak of construction."
Scott said the design would be in keeping with the existing development to maintain its high-quality look.
"It's exciting to be able to bring something the community needs."
The project is expected to be completed by December 2021.
$6m commercial centre under way
A $6m commercial and residential development was also under way in Pāpāmoa.
The Felton Commercial Development at Sandhurst Drive will have the capacity for eight tenancies, ranging from 70sq m to 280sq m.
Veros development director Mike Kemeys said construction would be completed before the summer break this year.
"The first businesses can't wait to get their doors open for the Christmas holiday period."
Kemeys said a local family who had owned the land for a long time saw an opportunity to provide "a great range of local convenience shops, food and experiences, that are easy to get to and pop in and out".
"We are hoping the development will be a real central hub to the area, connecting and servicing the local community."
Once complete, the centre will be home to 10 businesses and Kemeys said depending on the tenants that filled the remaining spaces, there would be close to 50 people working at the retail centre each day.
"Demand has been amazing but we have been very mindful of getting the mix of businesses right."
Kemeys said the building was 50 per cent full.
"We are confident of having it fully tenanted over the coming months although there is still a window of opportunity for businesses to get in touch."