Christchurch Office Market Dynamics Q2 2026

• The Christchurch office market tightened, with overall vacancy falling to 9.8%. However, this improvement is likely temporary, as a significant pipeline of over 40,000 sqm of new and refurbished space is expected to push vacancy back up, especially for secondary-grade assets.
• Rents remained stable this quarter, with prime CBD at NZD 420 per sqm p.a. and secondary at NZD 295 per sqm p.a. While modest rental growth is forecast, investment yields have softened, rising slightly across both prime and secondary properties.
• The outlook is one of gradual, cautious recovery. Although the market is in a better position than previously expected, the combination of a large future supply and economic uncertainty means tenants are expected to remain highly selective, leading to longer negotiation times.

The overall Christchurch office vacancy rate declined to 9.8% in 1H26, down from 10.2% in 2H25. CBD vacancy eased to 10.4% (down 40bps), while suburban vacancy fell to 8.3% (down 50bps), indicating modest tightening across the market. Over the next three years, Christchurch’s CBD office market is expected to see approximately 40,692 sqm of newly developed or refurbished office space delivered, in addition to the existing 51,382sqm of vacant stock currently available. The addition of this supply is anticipated to place upward pressure on vacancy levels, particularly across secondary-grade office assets.

Prime CBD and Secondary CBD average net rents remained stable this quarter at NZD 420 per sqm p.a. and NZD 295 per sqm p.a., respectively. Prime CBD average net rents are projected to rise by NZD 10 per sqm p.a. by the end of 2026, when it is expected to reach NZD 430 per sqm p.a. Secondary CBD rents are anticipated to strengthen modestly in the coming years, with average net rents rising from NZD 295 to NZD 300 per sqm p.a. by 2027, primarily due to landlords seeking to offset higher operating costs. Prime and Secondary CBD average net yields softened this quarter, rising by 5bps to 6.45% for Prime CBD and by 6bps to 7.19% for Secondary CBD.

Although the upcoming development pipeline is expected to contribute to higher vacancy levels over the short to medium term, the recent improvement in occupancy has positioned the market more favourably than earlier forecasts suggested. Leasing momentum is anticipated to strengthen gradually; however, occupiers are expected to maintain a cautious and selective approach, potential resulting in extended negotiation and transaction timeframes.