Lack of Shop Space Should Help Retailers

THE lack of new shopping space in Wellington will enhance the trading performance of existing centres, international property company CB Richard Ellis says.

The last new space came on stream with the completion of Harvey Norman’s Lower Hutt centre (13,000 square metres) nine months ago, it said.

CBRE’s retail director, Erin Palmer, said only one major project was under construction — the Cobham Drive Shopping Centre (3800 square metres) in Evans Bay, Wellington, which has secured a major tenant who is taking over half the building area.

Mr Palmer said the new centre had frontage to the main route between the airport and the city. It was also next to the planned indoor stadium.

“While major new supply is in hiatus, in the medium to long term there are several new retail developments planned for Wellington, Porirua and Hutt Valley with a mix of bulk and specialist retailing opportunities.

“There are also several inner- city stores under construction as part of Wellington’s increasing apartment market. The first of these to open will be the balance of the Chews Lane development on Willis St, which has 29 stores.”

CBRE research director Zoltan Moricz said the September quarter had been a relatively quiet one on the Wellington retail scene. Despite easing, the region’s retail confidence level remained among the highest in the country.

A shortage of space had put pressure on rents, with Partridge Jewellers paying more than $2500 a square metre to renew the lease on its 78-square-metre shop in Lambton Quay.

Mr Moricz said demand remained strong for well-located premises.

But space in less popular areas was difficult to lease and vacancy problems were the result.

“Lower Hutt city centre is becoming more price competitive, with bigger incentives reflecting higher vacancy levels since the Queensgate Shopping Centre expansion finished.”

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