Report says business land supply “at best” meets 5-year demand

A report to Auckland Council’s economic forum tomorrow says available business land supply is “at best” meeting the council’s targets to meet 5-yearly demand.

The calculation was done on average demand since 1996 of 93ha/year. Demand peaked at 130ha/year and fell to 42ha/year over the last 5 years – and demand is picking up as the economy rises.

The report warns: “However, if demand picks up to meet or exceed the high scenario outlined, or if land identified is not available, it is clear that the supply of industrial business land will begin to tighten rapidly if no new sources of supply are provided for.”

The report by principal advisor David Taylor recommends that business land be made a key consideration of the council’s spatial priorities work currently being advanced, and that new areas of business land growth are prioritised in any future land release programme the council outlines.

Just how much industrial land is really available depends very much on how it’s counted: all land zoned industrial, including many sites impractical for large users, all land that might be available or that is available or that is realistically assessed as available.

Mr Taylor wrote: “Depending on land take-up rates, it is estimated there is approximately 7-14 years’ worth of industrial land supply available in the Auckland region, notwithstanding the small size of some vacant parcels available.

“However, if no new sources of land are provided for, business land is taken up by other competing activities and demand accelerates/exceeds historical take-up rates, Auckland’s supply of industrial business land will begin to decrease quickly.

“It is therefore important to continue to plan for & enable greenfield business land opportunities that have been signalled in the Auckland Plan & proposed Auckland unitary plan in an appropriately staged manner. Current efforts to identify spatial priorities for growth and to develop a land release programme should have explicit consideration of business land demand to ensure the region can meet its land needs over the short, medium & long term.”

The proposed unitary plan has outlined the mechanism for meeting the business land demand targets. “This is achieved though providing some 6500ha of new greenfield land in the proposed future urban zone, which will accommodate the majority of this 1400ha of business land, as well as significant residential development (for 67-90,000 dwellings).”

The council has assessed plan-enabled supply of both land & floorspace potential through its comprehensive capacity for growth study, most recently published in 2012. More recent modelling has been done to show the capacity that could be expected under the new planning provisions of the proposed unitary plan. Those results are expected to be reported to the unitary plan committee on Wednesday 9 July.

Mr Taylor said the preliminary results showed a total business land capacity of about 3310ha, from a total business land area of 7800ha in the region.

“This is encouraging, due to the need to provide for ongoing business growth in the region,” Mr Taylor wrote. “However, the nature of some of this capacity – ie, in many cases small & fragmented sites – may not provide for all business land needs. In particular, the needs of new industrial activity which typically occurs on vacant, land extensive sites. Data from the 2012 survey showed close to 60% of vacant business land parcels in the urban areas were smaller than 1000m².

Preliminary results from the newer research showed a total industrial land capacity of about 2482ha 858ha of vacant industrial land, 1334ha of vacant potential industrial land, and an estimated 290ha in the pipeline, progressing through plan changes under operative plans.

“It should be noted that there are some limitations to the supply of vacant potential land. Vacant portions of the occupied sites considered as vacant potential may continue to remain unavailable for development, given they are utilised for specific purposes – such as meeting bank requirements for loan insurance purposes, parking or truck manoeuvring or providing for future expansion opportunities.

“A further 1400ha of new greenfield land, of which 1000ha is allocated for industrial activities, is identified in the Auckland Plan as a long-term prospect (currently not zoned or serviced). Work has been progressing to finalise the details of this new industrial land within the proposed future urban zone.”

On the question of demand, Mr Taylor wrote: “The most recent employment projections for Auckland generate an estimated demand for some 1398ha of new business land over the next 30 years. This is consistent with the assumptions used to develop the Auckland Plan, and highlights that the strategic approach outlined in the plan in relation to future land provision remains robust. In particular, the projected industrial floorspace growth over this period of around 6 million m² of floorspace, or about 1000ha, remains stable (albeit a slight decrease of 200,000m² (or .03%) from earlier projections, well within the margin of error).”

He said council staff were confirming the location, scale & timing of new industrial business land opportunities that contributed to developing the proposed future urban zone in the proposed unitary plan.

“This includes a significant amount of the land that is signalled for business activities through private plan change proposals (such as Drury South), area planning exercises (such as the Pukekohe area plan) or are subject to structure planning exercises (such as emerging efforts to reassess the business growth potential of land around Kumeu & Whenuapai, or legacy council efforts to assess areas such as Silverdale & Warkworth).”

Link, Council agenda report: 13 Industrial business land

Attribution: Council committee agenda.

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