It means that there are now two very different pictures in the commercial property space between New Zealand and Australia, the RICS Oceania Commercial Property Survey has found.
The market in Australia, working its way through moderate economic growth rates, is softer with sentiment in the occupier market firmly entrenched in negative territory.
The report says that Australia's woes are compounded by decreases in occupier demand, increasing vacancy rates and a slow down in rental expectations which have sunk to a five year low. At a headline level inducements by landlords have increased in response and development starts are static.
Meanwhile in New Zealand the picture is much brighter with occupier demand, and rental expectations soaring to five year highs as the New Zealand economy continues to rebound with construction being the major driver over the next few years.
‘With the New Zealand economy expecting to grow by around 2.6% over the course of the year to June and Australia's economy slowing in the second half of last year and looking to be below trend for 2013, the market has responded accordingly,’ said Kaye Herald, RICS Asia Pacific Managing Director.
‘While investor sentiment in Australia remains positive this quarter it is less that it has been previously. In New Zealand the sentiment of investors is remaining at close to last quarter's highs,’ she added.
