Suburban office boom predicted
Record low-vacancy rates and the increased cost of commuting have resulted in an urgent need for suburban office space in Auckland's central business district (CBD), according to Pierre Ferrandon, New Zealand Area Director for Regus. The high costs of offices in Auckland CBD is making suburban work space more attractive for businesses and entrepreneurs. Auckland's population is predicted to rise by one million people over the next 30 years.

Worsening traffic congestion and rising house prices will see more Auckland businesses set up offices in the suburbs, a workspace commentator predicts.

Pierre Ferrandon, New Zealand Area Director for Regus, says there is a global trend towards satellite offices, suburban office parks and even second CBDs in large cities where central city office space is at a premium.

“CBDs are becoming victims of their own success. Location is as important as ever for businesses, so CBD office space is in hot demand,” he says.

“Auckland is no exception, with record low vacancy rates making it hard for businesses to find suitable office space in the central city at an affordable price. The CBD’s popularity may also be contributing to traffic congestion and rising house prices in the inner suburbs.”

Ferrandon says Auckland will likely follow in the footsteps of Sydney, where he worked previously for Regus before crossing the Tasman.

“Sydney’s CBD is an expensive location for businesses and it is difficult to access for many workers, including those on the western side of the city,” he says.

“These factors have contributed to a growing number of office parks popping up in Sydney’s suburbs, as well as the state government designating Parramatta the city’s ‘second CBD’. Auckland may need to take similar action to cope with its own challenges.”

These challenges include high house prices, which are leading many Auckland families to move farther out and endure long and expensive commutes, Ferrandon says.

A recent Regus survey found commuting costs are hitting Kiwis in the pocket, with three out of 10 workers spending more than five per cent of their take-home pay getting to and from work.

“Auckland’s population is forecast to expand by as much as one million over the next 30 years and up to 40 per cent of that growth is expected to be outside the city’s current boundaries. Most people in these distant suburbs will not want to come all the way into the city to work.

“If businesses want to attract the best staff, they need to provide convenient work locations. While most big companies will continue to be headquartered in the CBD, they may open satellite offices in places such as Takapuna and Manukau.”

Ferrandon says Regus sees growth opportunities for its own business in Auckland’s suburbs.

Regus currently has three offices in Auckland’s CBD and one in Newmarket. It has also signed a lease in Precinct’s Commercial Bay development.

www.regus.co.nz