Big shifts in value reflect new city
Christchurch commercial land values have generally fallen sharply - up to 50 per cent - in inner parts of the central city but increased in outer areas of the CBD such as Victoria St.
The commercial land values have also risen strongly in suburban commercial areas, in some cases by more than 40 per cent, under property revaluations that will influence how much owners pay for rates.
Christchurch City Council yesterday released its first "post-quake" property revaluation to take effect on city and Banks Peninsula properties from July 1. They are the first new ratings since 2007 with an update scheduled for 2010 put off because of the September 2010 earthquake.
Property and business commentators said there was a wide range of influences on the inner city valuations. One who works in the industry said the 2007 valuations had been too high and recent sales prices for some inner city commercial land were similar or higher than seven years ago.
Canterbury Employers' Chamber of Commerce chief executive Peter Townsend said the diverse valuations reflected a city that had "changed quite markedly" as a result of the 2010-2011 quakes. Higher resulting rates could impact on prices to occupy areas like Victoria St, he said.
While there was frustration at the slow inner city rebuild, there was notable progress on projects including the justice precinct and a new building for Environment Canterbury in Tuam St.
The revaluation was carried out by independent valuer Quotable Value, with an average rating value increase of $101,254 per Christchurch property. Property owners had a rating valuation of $1.268 million in 2013, up 8.7 per cent from $1.166m in 2007.
However, the CBD saw a loss in capital value of 61 per cent for properties at the "low" end of capital value changes. Some of those were vacant sites. At the other "high" end, CBD commercial properties gained 38 per cent in value. On average CBD commercial properties lost 9 per cent in capital value.
Property Council of New Zealand chief executive Connal Townsend said as new projects were completed, they would establish a new valuation or market precedent for the area.
"Any generalisation would almost be meaningless. Where there's been a demolition or nothing on that spot, those might account for the downs, and the ups might be [where] we've actually had projects completed."
Other areas where commercial capital values lost ground on average included Linwood, down 6 per cent; Lyttelton, down 3 per cent; and New Brighton, down 2 per cent.
On the high side there were capital value gains in Casebrook-Bishopdale, up 35 per cent on average, Redwood-Northcote, up 33 per cent, and Hornby-Hei Hei-Islington plus Ilam-Burnside up 28 per cent.
QV southern operations manager Brendon Bodger said inner CBD land value decreases of up to 50 per cent included retail areas that had high pedestrian counts before the quakes, such as City Mall and Colombo St which received "some pretty lofty values" in 2007.
"Things were travelling pretty well in 2007 . . . where there were values of $10,000-$12,000 a square metre [for land], those sales levels are now $4000-$5000."
The fall partly reflected what developers were prepared to pay given the increased costs of building to stronger standards.
In Victoria St, land value increases up to 50 per cent to around $2000-$2500 a square metre reflected the vitality of that strip.
"With the newer [rebuilt] prime office accommodation nearing $400 a square metre, that's around a 30 per cent increase on the 2007 levels," Bodger added.
"That was a direct consequence of a lot of the prime stuff coming down [being demolished] in the CBD."
- The Press