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Most IT firms in Auckland prefer suburbia than the city for office space: CBRE New Zealand

Divina Paredes | June 4, 2014
Location is often determined by the area where most employees live, says CBRE New Zealand

IT companies took up 5 per cent of all office space in Auckland last year, and was the seventh most active sector with regards to relocation to new space, according to CBRE New Zealand.

"The key drivers of change we are seeing in the IT sector's use of space are consolidation, expansion, and relocation due to growth," says Gergely Gaspardy, research manager, CBRE New Zealand.

Gaspardy says the three largest moves in the second half of 2013 were Dimension Data, Orion Health, and EROAD.

Dimension Data consolidated several office locations to its new HQ in the Viaduct. Similarly, Orion Health took up some additional space on the other side of the road where they have their head office already so expansion was their key driver, says Gaspardy.

EROAD, meanwhile, recently moved from a space measuring around 600 square metres, to 1,300 square metres due to extremely fast growth in recent months.

EROAD moved within Albany because that is where most of its workforce is based, says Gaspardy. "With a high growth trajectory, it is likely that the business's space requirements will continue to change rapidly in the coming months and years."

IT firms gravitate to suburban areas

CBRE's research shows suburban areas are more popular with IT occupiers than the central business district (CBD) or city fringe.

It says 13 per cent (14,000 sqm) of office space is in the CBD, while just over a quarter, 27 per cent (29,500 sqm) is located in the CBD fringe. The majority (60 per cent) of IT offices are in Auckland's suburban areas.

Grafton, Greenlane, Albany and Takapuna are the most occupied suburban areas, with some 3,000 square metres of 'Grade A' space occupied in Greenlane.

Within the central city, the CBD core is the top spot for IT firms. However, for Grade A office space, the Anzac Ave Zone is leading the way, with the Victoria Quarter and Viaduct Basin Zone offering some very good quality Grade A spaces too.

Gaspardy says that generally speaking, IT companies do not seem to have a strong preference for one particular location, contrary to law firms, the financial sector or the education sector — which all have rather clear preferences about locations.

"The location of an IT firm is in many cases determined by the area where most of the company's workforce lives, as demonstrated by EROAD, or even where the principals of the company live.

"There are 208 IT service firms occupying office space in Auckland's CBD, city fringe and suburban areas, which is a healthy — and growing — figure. Between those 208 firms, the total occupied space is 109,000 sqm, which represents 3.5 percent of all occupied stock in the city."

 

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