A technology revolution is driving the future of Hawke's Bay land and property use, says Frank Spencer of property and valuation firm Logan Stone.

He said Hawke's Bay's growing economic strength supported the new business environment, driving steady demand for commercial Hawke's Bay property.

The region had reached a point where growth was "steady with bursts of activity" in contrast to the cycles of the past 80 years, where long periods of stagnation were interrupted by bursts of growth.

"The strength of the national property market demonstrated through investment since 2013 has led to confidence in the growth of regional New Zealand and Hawke's Bay is a prime example," Mr Spencer told more than 120 property investors, financiers, rural businesspeople and politicians at Logan Stone's recent annual Perspective presentation.

Advertisement

"There's been solid investment from offshore with investors, both national and international, looking for alternatives to Auckland, particularly in the sub $5million price band. Investors are keen for better cash returns, which Hawke's Bay can provide, while others are looking to mitigate risk through geographic diversity within their portfolios.

"In addition, New Zealand is viewed internationally as an attractive sanctuary in an increasingly volatile world, and the Hawke's Bay 'brand' is very well regarded, all of which has positive impact on those considering investing and doing business here," Mr Spencer said.

The business mix was changing, he said. Health and fitness, child care and education were on the rise and in all of Hawke's Bay's central business districts hospitality and non-retail operations were replacing traditional stores.

"Hospitality accounts for about a quarter of Havelock North and Taradale central premises, with further development in Havelock North to come."

He said cafes were an alternative business venue and replaced floor space formerly provided in offices.

Collaborative business spaces such as the new Tech Hub in Ahuriri that has telecommunications company NOW as anchor tenant plus other technology-based businesses including Xero.

"Businesses are needing less office space due to technology adoption that is changing the world of commerce," Mr Spencer said.

"The more we accept and embrace technology, the more disruption is caused to real estate assets and the traditional way these are used. The technology revolution is definitely causing a stepwise change in the role of bricks and mortar real estate, not just in and the way we use, but also own them."