What is catching the eye of buyers in New Zealand's commercial property sector might not sound sexy but it has the ring of reliability, and that is something weary investors will find appealing.
Instead of the soaring price gains Hong Kong investors were accustomed to during the heady years of the territory's bullish property market, New Zealand's commercial sector is set for steady growth with solid rental yields - just the kind of tonic needed as the global economy faces recessionary chills.
'It's a limited capital growth story and a good income-producing story,' said John Goddard, international sales director, at
the Auckland office of Colliers Jardine.
One reason for the even-keel forecast is that New Zealand is unlikely to break out with rapid domestic economic growth, as its economy is largely agricultural and tourism based, while its commercial heart is dominated by mid-sized service organisations.
With a lack of large multinational head offices, most of the grade A uptake in Auckland's central business district is consumed by smaller accounting, banking, consultancy and related service industries.
That kind of client base is strong enough to account for a net uptake of 30,000 sq m in the city's central business district last year. Total grade A stock is approximately 1 million sq m.
Despite the arrival of two new projects on the market in recent times, the net take-up rate has been enough to absorb the supply, with vacancy rates averaging 3 per cent.
New supply is expected over the next two years, but analysts forecast few price disruptions.
The bonus for long-term investors, Mr Goddard said, is that New Zealand's slow price gains means the property sector is largely removed from the boom and bust cycle that dominates fast-growth property markets such as Hong Kong and London.