JLL's Christchurch industrial market dynamics provide property insights into warehouse vacancy rates, development activity, and rental trends in the South Island.
Insight
25 May 2026
Christchurch Industrial Market Dynamics Q1 2026
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The vacancy rate reached 5.9% in 2H25, reflecting a 70bps rise from 1H25 due to moderating demand and increased supply in recent months. By precinct, vacancy rates are now 6.1% for West (up 50bps since 1H25) 4.9% for South (up 160bps), 6.7% for East (up 70bps), and 4.1% for Rolleston (up 60bps).
The Christchurch industrial market continues to expand, with around 26,000sqm of new warehouse space completed in Hornby and Islington over the past six months. Currently, approximately 180,000sqm of industrial space is under construction, including significant projects such as 14 Gallagher Drive in Hornby and an adjacent 6,000sqm yard for industry tenants.
Major occupiers are driving further development in the region. Lineage Logistics has now received consent for its major cold storage facility in Rolleston to strengthen its national network. The Carter Group is also delivering new space at Maddisons Road in Iport Industrial Park (Stage 13).
The market has entered an extended period of rental stability, with rents unchanged across all grades for the seventh consecutive quarter. The most recent movement occurred in 4Q24, when prime average net combined rents grew by 3.7% to NZD 169 per sqm p.a. and secondary rents rose by 5.1% to NZD 124 per sqm p.a.
Prime average net yields have marginally firmed by 5bps, declining from 6.18% to 6.13% this quarter, and are expected to stay unchanged until mid to late-2027. One notable transaction this quarter was the sale of 5,020sqm industrial property at 55 Foremans Road in Islington for NZD 19.00 million.
Outlook
Demand is expected to remain broadly steady and gradually recover as business confidence and economic conditions improve, though occupiers are likely to remain cautious in the near term, with leasing decisions potentially taking longer to conclude and some consolidation of space continuing across the market.
Industrial rents are expected to remain broadly stable in the near term, with greater upward pressure returning when the economy recovers and demand rises and absorbs new supply at a faster pace, particularly for well-located prime stock in established precincts.