JLL's Wellington industrial market dynamics provide property insights into warehouse vacancy rates, rental performance, and supply constraints in the capital.
Insight
25 May 2026
Wellington Industrial Market Dynamics Q1 2026
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Industrial property demand in Wellington softened throughout 2025, as reflected in the latest survey results. The overall vacancy rate rose to 4.2% in 2H25, representing an increase of 240bps compared to 1H25.
Vacancy rates by precinct were 4.2% for Petone (up 100bps from 1H25), 2.1% for Seaview (up 10 bps), 10.5% for Ngauranga (up 280bps), 7.2% for Grenada North (up 10bps), and 4.7% for Porirua (up 90bps compared to 1H25).
Development activity in Wellington’s industrial market continues to be constrained, with fewer than 30,000sqm of new space currently under construction. This limited pipeline reflects ongoing challenges in bringing new supply to market. Wellington’s industrial sector is demonstrating resilient growth, with 38,634sqm of floor area consented for new factories, industrial, and storage buildings in the region for the year ending December 2025.
Prime and secondary average gross rents remained unchanged at NZD 192 per sqm p.a. and NZD 139 per sqm p.a., respectively. Prime warehouse rents continued to range between NZD 152 per sqm p.a. and NZD 216 per sqm p.a., while secondary warehouse rents also held steady within a range of NZD 110 per sqm p.a. to NZD 168 per sqm p.a.
Prime and secondary average net yields remain unchanged at 6.75% and 7.94%, respectively, following a 125bps softening in 1Q24; prime yields are forecast to remain stable until mid to late-2027.
Outlook
Demand for Wellington’s industrial sector remains selective, reflecting the wider economic environment and the sector’s more local focus compared to other major industrial hubs. Although the vacancy rate remains low, it has begun to increase over recent months. This additional space in the market should provide industrial tenants with more leverage when negotiating leases, relocating, or searching for new premises.
The impact on the current balance of demand and supply is tempered by a limited pipeline of new developments, which should help prevent a significant oversupply from occurring.