Hawke’s Bay’s strong economy, underpinned by well-performing primary industries, a tourism boom, buoyant construction industry, and the low interest rate environment, is driving redevelopment of commercial and industrial properties around the region. “We’re seeing a number of redevelopment projects underway or planned, with a good portion of these projects being previously vacant, redundant or outdated property,” reports Ben Hamelink, a registered valuer with Logan Stone, a Hawke’s Bay-based national valuation firm. “The continued low interest rate environment has made owner occupation attractive,” Hamelink says, noting that the increase in vacant property purchases was for both owner occupation and development purposes. He indicated that the continued strength of the local economy was “putting more money in the pockets of Hawke’s Bay businesses” and this was increasing the demand for modern commercial and industrial property and increasing rents. That, together with the significant rise in construction costs, particularly around the compliance and planning stages, and rising land prices, was making redevelopment of existing buildings a more affordable option than new development, Hamelink said. His comments follow Hamelink’s research of the Hawke’s Bay commercial and industrial property market over the first half of the year. In Napier, there has been increased activity about Onekawa with redevelopment projects transforming dated industrial property into more intensive and productive use. The former Just Commercial Partsworld site between Niven and Wakefield Streets has been subdivided and redeveloped to now contain two large warehouse tenancies with contemporary offices, a new workshop on a freehold site alongside another vacant freehold site fronting Niven Street. There is also a new unit title development fronting Wakefield Street with nine modern industrial units. Other notable Onekawa refurbishments include properties at 15 Edmundson Street and 48 Niven Street, which both sold separately in early 2018 for a total of $3.95 million after building upgrades and new tenant commitment. Refurbishment of 78 Taradale Road is currently underway to accommodate the two sitting tenants and six new tenancies. Two of the new tenancies will be occupied by local businesses expanding into higher quality premises. In the Napier CBD, redevelopment continues between Hastings Street and Marine Parade with the former Opossum World and House of Swords building now fully upgraded and leased to Sotheby’s Real Estate, Mexicali Fresh and Colliers International. The adjoining three-storey development on the corner of Hastings and Albion Streets is now complete and fully leased. The nearby Central Post Office building on the corner of Hastings and Dickens Streets, is also fully occupied and was sold to a developer for $8 million after strengthening and redevelopment work was completed throughout 2013 and 2014. A substantial redevelopment site between Hastings Street and Marine Parade was purchased in early 2018 for a specific development. Close to $13 million of vacant commercial property in and around the Hastings CBD has sold over the last two years for redevelopment or refurbishment purposes. Prominent redevelopments include the former Warehouse Stationery building on the corner of St Aubyn and Market Street now occupied by Tremains, the new … Read more
Logan Stone director Jay Sorensen is profiled in the Summer issue of the New Zealand Property Professional magazine. You can read the article here. Entering rural valuation Jay acknowledges that when he started university he wasn’t entirely sure where he was heading, except he knew he enjoyed the agriculture sector and was interested in numbers. Then he ‘fell’ into rural valuation and embarked on his career with a passion. From a Hawke’s Bay farming family, Jay was at Massey University studying for a Bachelor in Applied Science where he encountered rural valuation as an option. Until then it had been something he knew little about, and says it was not well marketed. Logan Stone opportunity At the end of his second year at Massey Jay sent out emails looking for holiday experience. Logan Stone, a national valuation and property specialist firm based in Hawke’s Bay for 30 years, responded. Boyd Gross, the firm’s primary industries sector leader, opened Jay’s eyes to the rural valuation world and that has been his ‘home’ ever since. Graduating with a double major in rural valuation and management, and agribusiness, Jay joined the firm in 2008, at the age of 21, and seven years later became a director of the firm. In the intervening years, he has actively pursued his career, and in 2015 was selected as the Property Institute of New Zealand Young Professional of the Year (an award his mentor Boyd Gross won in 1997). Promoting valuation as a career Drawing on his own experience of not knowing about valuation as a career option, Jay sees it as a responsibility and challenge to bring a younger voice to raising the profile of his chosen career among students and graduates. As a past member of the Property Institute Young Leaders’ committee, he was involved in a project to develop resources for secondary school students to encourage greater interest in property as a career option. He enjoys making presentations to students in Hawke’s Bay at careers days and, having developed an affinity with some of the region’s schools, talks to groups of 10 to 25 young people at a time. He’s heartened by the good questions that arise from these discussions and the growth in numbers taking up valuation studies at university in recent years. He is also pleased to see the Property Institute’s attendance now at careers days. Addressing industry challenges Aware that the industry is top heavy with older males, Jay sees his role on the Property Institute Standards and Valuation Committee as important, providing a younger perspective in reviewing and enhancing new standards and preparing for the changes facing the industry. The automation of valuations is one growing trend that Jay believes will change the industry, with much of the simpler work possibly eroded, as well as the potential for more limited client contact and feedback opportunities. Jay believes that the industry needs to continue to ensure members provide quality advice so they can maintain client contact and add value through robust … Read more
A new updated report has been released detailing the risk of earthquake-induced liquefaction in Hawke’s Bay. The report gives greater insight into how properties may be affected in the event of an earthquake. Since 1840, Liquefaction effects have been reported during four of the seven earthquakes having produced ‘strong shaking’ in Hawke’s Bay (Hawke’s Bay Civil Defence, 2017). There are areas of Hawke’s Bay underlain by potentially liquefiable soils, and there are several earthquake faults within or near the area capable of generating strong earthquakes. Low lying areas of Hawke’s Bays, particularly near the coast, and reclaimed land are particularly susceptible to liquefaction. The 2017 report refines previous work being more specific and is a worthwhile reference for property owners, tenants, developers and investors concerned with potential seismic risks. The report is available here and a FAQ sheet available here. Councils are currently reviewing the updated hazard information and how it will be incorporated into building and resource consent applications and District plans. The Hawke’s Bay Civil Defence Emergency Management Group in conjunction with the region’s five Councils commissioned the GNS Science report, which builds upon the historic GNS Liquefaction study carried out in the Hawke’s Bay region in 1999. The report concludes that there is little change in mapped liquefaction susceptibility to Wairoa, Napier, Hastings, and Havelock North with a reduction in the mapped liquefaction hazard in parts of Taradale and a significant reduction in the hazard assessed in Central Hawkes Bay. Liquefaction has been widely recognized as one of the principle earthquake hazards (Department of Civil Engineering, Universirty of Canterbuy, 2014). ‘Liquefaction is the process where, during earthquake shaking, sand and silt grains in wet soil are rearranged and the water in the spaces between the grains is squeezed. Pressure builds up until the silt and sand grains float in the water, and the soil behaves more like a liquid than a solid. The pressurized water is forced up to the ground surface through the easiest path it can find – often through cracks and crevasses in the ground or concrete. The water takes silt and sand with it, forming boils or volcanoes. The ground surface above liquefied soil often tilts and sinks.’ (ECAN, 2017) As a result of earthquake induced liquefaction, buildings, roads, pipes and other associated infrastructure can be damaged by the tilting or sinking of the ground. ‘Lessons learned about liquefaction after the Canterbury earthquakes has allowed scientists to significantly refine and improve existing liquefaction susceptibility maps for the Hawke’s Bay region, using existing geological, geomorphological, groundwater and geotechnical conditions’ (Hawkes Bay Emergency Management, 2017). The report noted that liquefaction effects had been reported in the Hawke’s Bay during historical earthquake events with ‘ground damage including sand boils, water ejection, subsidence and fissuring and lateral spreading’ (New Zealand Herald, 2017). Hawke’s Bay is considered one of the most seismically active, with several large and damaging earthquakes having occurred since records began. ‘Hawkes Bay is located on the Australian Plate, about 150km west of the Hikurangi Trough, which marks the … Read more
There are approximately 860 properties in Central Hawkes Bay that still require a completed Farm Plan by 31 May 2018 in order the meet the requirements under the Tuki Tuki Plan Change. The deadline of 31 May 2018 is quickly approaching, with just over 6 months left to go, the Hawkes Bay Regional Council is advising that financial penalties will be imposed if land owners have not completed a Farm Plan by this deadline. Our advice to farmers is to not put this off, nutrient management regulations are a tool used by Regional Councils to meet their responsibilities imposed by the Resource Management Act and are being rolled out nationwide, so this is not something that will go away. Hayley Mortleman and Jay Sorensen are fully qualified to undertaken Nutrient Budgeting and Farm Environmental Management Plans, and have completed a number of Farm Plans for clients within the Tukituki Catchment. Both Registered Rural Valuers, Hayley and Jay have extensive knowledge and understanding of both farming systems and nutrient management implications, a diverse rural support network and a strong connection with the land. “We want to work with you to develop a farm plan that not only complies with the plan change requirements, but also works for you in the long run providing practical, workable and affordable solutions and strategies for your farming enterprise” If you have any Farm Environmental Management Plan questions or require any no obligation advice, please contact Hayley or Jay at Logan Stone Ltd, Hastings.
Water is a finite resource. While it appears to flow endlessly down our rivers, and is pumped perpetually from the ground, there is only so much to go around. Effective management of our water resource is vital to ensure its benefits can be fully captured to optimise the productivity of our land, and ensure New Zealand maintains its clean green image. A large amount of legislation has been introduced from both Central Government and Regional Councils to ensure the quality of our waterways are maintained or improved. There is some belief that these imposed standards are not tough enough, however these rules need to be balanced to ensure land use practices remain sustainable, not only from an environmental perspective but also from a financial and productive standpoint. From a financial perspective, if the land is not profitable, land owners will have no capital to invest in their properties ensuring rules such as fencing waterways, are complied with. From a productive perspective, it is paramount that we produce enough food to feed our expanding population. There is a growing disconnect between the urban population and the land; policy setting needs to address protection and enhancement of our water resources, but we also need to be realistic and understand that food does not simply just appear in the supermarket. Most farmers and growers see themselves as custodians of the land, and are extremely proud and passionate about their properties. The majority are also farming for future generations and do not want to see a deterioration of water quality over their lifetime. It’s also true that most farmers are not nutrient specialists, relying instead on recommendations for nutrient inputs to ensure productivity is maintained or enhanced, and excess nutrients are not lost into waterways. The introduction of Regional Plans means that farmers will have a better understanding of the way nutrients move through their property, which should have both financial and environmental benefits. These plans do come at a cost, but this needs to be weighed against the long-term image of land based practices within this country. New Zealanders want to improve water quality, and this needs to be a collaborative effort throughout a varied range of industries and communities. Regional Plans will also introduce tougher rules around low flow levels in our streams and rivers, with water takes being tightly monitored to ensure a better allocation of our finite water resource. Resource Consents for water takes are likely to become more valuable, especially for properties in water-short areas. Various water catchments within Hawke’s Bay are currently in a ‘fully allocated’ or ‘over-allocated’ state. This includes the Tukituki, Karamu and Ngaruroro catchments. Land owners of properties in these areas should be very aware of their Resource Consent limits, ensuring they manage their water efficiently. There is a risk in these areas that if you are not using your full water allocation, your allocation may be reduced back to a level aligning with actual water usage, which could impact the future land use of … Read more