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Gisborne's economy is moving ahead at a steady clip

Commercial

Property Brokers 06 Aug 2021

Blog image_GizzyWhile a small number of businesses were lost over the lockdown, and, apart from Travel Agents who got knocked around pretty badly, most have come through.

Like most of New Zealand, the retail sector is suffering due to the ever-increasing level of online shopping. It appears that during the lockdown, people grew accustomed to shopping online and have continued to do so.

The horticultural sector has (and continues to) go through significant expansion, especially with the planting of gold kiwifruit and apples. This has resulted in substantial increases in horticultural land prices. A number of the big players in the horticultural scene are now looking to build staff accommodation due to the shortage of rental accommodation.

A significant shift in land prices has come about due to Gisborne being desperately short of industrial land, especially close to the city. Not so long ago, land was selling around $100 per square metre, it is now close to $300 per square metre, and recently, several industrial properties were sold just to get the land, with an adjusted land price of $416 per square metre.

The forestry sector has been going through steady growth for the last few years. After the significant hiccup during the GFC, the industry seems to have achieved a balance between the forest owners, harvesters and exporters.

Like Tauranga and Auckland, Gisborne has recently had a backlog of log ships parked in the bay with up to fourteen ships lined up to load. The second stage of a very hi-tech timber processing plant was given the go-ahead last month, which will see the district making further supplies of precision manufactured framing timber to the New Zealand market.

Gisborne has an ongoing demand for good, well leased commercial properties with cap rates falling below 5%pa. A significant proportion of earthquake-prone buildings have been strengthened over the last five years resulting in some very smart properties in the district.


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