Auckland's Midtown district is undergoing a NZ$10 billion transformation that is fundamentally reshaping New Zealand's commercial capital.

Anchored by the $5.5 bn City Rail Link, the country's largest infrastructure project providing the equivalent connectivity of 16 new highway lanes, news of the city’s transformation is spreading fast around the global investment community.

In this episode of the Perspectives podcast, Todd Lachlan, managing director - New Zealand, JLL, chats to Simon Bridges, CEO of the Auckland Business Chamber and Viv Beck, CEO of Heart of the City about the exciting future ahead for Auckland's CBD.

Hear about:

1. Auckland's economic recovery
2. The City Rail Link (CRL) project
3. International investment interest
4. Queen Street developments
5. Smith & Caughey's building
6. Vision for Auckland in 2030
7. Tourism and student population growth
8. Major events and infrastructure projects

The NZ Narrative

[00:00:27] Todd: Great to be on.

[00:00:40] Simon: Well, I think after what Midtown has been through, it's pretty exciting to be at this point.

[00:00:45] Simon: Yeah and It's a huge story. It is a great story.

[00:00:59] Simon: Yeah, sure. I mean, I think first, it's been a tough few years. Right? And for those who are listening from out of town, I mean, I don't think some want us to say New Zealand terms, 5.3 million people.

[00:01:44] Simon: I would say realistic optimism. The numbers are starting to look better. I can tell you for example in the Auckland business chamber, business confidence survey. We do them, quarterly. First one out this year, I mean, just on every measure, really quite a lot higher than anything we've seen in my three or four years there.

[00:02:06] Simon: It's variable. That's why I say realistic optimism, right? But what that tells you is, businesses are starting to see it. We're not there yet and I can see where it's kind of going to come from, is what I say.

[00:02:46] Todd: And Viv, you're obviously in the heart of the city in the truest sense of it. Literally and your job obviously it is all about that. Not easy. I think you can probably reflect what Simon's been saying but feels to me like people are back.

[00:03:30] Viv: And I think generally people are feeling a lot better. So we're not quite through it for some people in that particular area we're talking about. It's been a tough decade to be honest, for many. However, we're pretty pleased the way 2026 are starting. It hasn't, to pick up Simon's point. It's not translating into spending, actually. And that's variable, depending on who you talk to, but the reality is across the board spending is still down, but the mood is up and I think there is realistic optimism.

[00:04:22] Viv: Well, not yet. I think when I moved, I live in the central city. And when I moved here, we reflected on the fact that it had gone from about 1500, you know, some years ago, 30 years ago to sort of 38,000. So there's been a huge growth and there's an aspiration to get to about 100,000, which is actually realistic I think when you think about the the population growth projected for Auckland, generally.

[00:05:05] Todd: We'll come more on to that in a minute. But it's definitely an opportunity. And that's I think that's what we're seeing around, around town is that there are projects coming out of the ground. So and so I think, you know, the big ones are obviously. You know, the CRL, not yet open, but it's been $5.5 billion of money spent between the Auckland super city and the government on that project. Simon, I know that you were heavily involved in the original conversations around that. What do you sort of see as the outcome? I guess the return on investment for that?

[00:06:02] Todd: Yeah.

[00:06:29] Simon: Firstly in a transport sense it's transformational. Someone told me I haven't fact checked this, so don't edit it out though, because it sounds good. It's the equivalent of 16 new highway lanes, right. That we are adding around Auckland. So just the ability to get to get around us is, you know, as I say, transformative. And then, of course, there's just the whatever you want to call it but the urban read out development and development.

[00:07:38] Simon: So that's exciting. But you know, and this report shows, it's not that, it's literally 20 something other Great builds going on that together mean we ready for the growth. Then add in, while I'm on a roll. But, you know, the demand factors, you've both talked about them, but it's it's tourism, it's students, it's city living. The other one. I don't want to steal your thunder, but, you know, I'm really excited about it. And I can be quite pessimistic when I want to be. And that's what's happening in terms of high net worth investors coming here out of Asia, out of North America. And we, you know, we might talk about that more, but that to me says, the next few years they sort of have to be really good for Auckland. Certainly much better than a reasonably, sluggish sort of period that we've been through.

[00:08:45] Viv: Yeah. Absolutely and I think the convention center as I say, is one of the key anchors. But it's not the only one, but it's very visible and it will have a massive impact, obviously growth. And the events, business events is significant and they're bringing a new sort of size configuration to the market. So we see, expecting to see growth. But then you go across the road to something like the formerly. What a phenomenal development. You know they've brought a new model to the market through Covid. That's incredible.

[00:09:22] Viv: Absolutely and is it's just beautifully positioned there right by the station. Sure. You think about the potential around there for what all those people are going to need. Then you walk around that university area and you look at some of that new accommodation and the proximity, that's a massive demand driver.

[00:09:42] Viv: And you start to top, a couple on top that growth of residents, then we will see it. You know, it's just been a challenging period, but we will see it take off. It was, as I say was growing before Covid, was leveled out. But it will take off. So you start to imagine an area there where all of these things are happening. And I don't think people have quite realized what difference that station there will make, actually. Because, you know, it opens up a whole lot of, you know, it's not just a node, it's actually a key point that people will be able to come to. They'll be able to work, live, easily get around. It is a really major opportunity.

[00:10:35] Simon: Yeah, we're hearing that.

[00:10:41] Viv: Yeah.

[00:10:48] Todd: and I think you know, something we talked about I guess on that theme of investment and capital. A big investment coming from a big Singaporean group that we're involved in, last year, and the Intercontinental Hotel, which was developed by Precinct as part of that major Commercial Bay development. Done a fantastic job down there. I think we could all agree.

[00:11:07] Todd: They've sold the hotel and I think you've had a reasonable, interesting kind of interaction with them recently.

[00:11:45] Simon: Just think about where the world's at. I mean, as we record this, all over the world, there's war, there's conflict, there's uncertainty. I mean, New Zealand's, and Auckland's is the biggest city is primate city as some say. Key disadvantage is that we've been, kind of, wrong word maybe, but irrelevant right?

[00:12:03] Simon: We're down the bottom of the world. What's that, last bus stop on the was to Antarctica, was it. Didn't someone use that?

[00:12:09] Simon: But think about it from the side of

[00:12:14] Simon: What's our, someone will have to fact check that as well.

[00:12:19] Simon: Oh was it? Right.

[00:12:20] Simon: What was our, what then today is our massive kind of, unintended if you like but strategic advantage? Well actually we're at the bottom of the world. We are a safe haven right? We are first world. We speak English. We're still prosperous. We have some great sectors. Whether it's you know, primary production, tourism, the tech sector or sectors. So I just stand back and say you get the settings right, you get the supply side stuff right, the demand factors, then if you take this investor space, we mentioned Singapore a lot of other Asians coming down.

[00:13:22] Simon: So they're coming from all over the world and think about this, Erica Stanford put out you know, a release I think sometime in February. The numbers don't lie. Two, three years, the last two or three years, we saw something like 70 million come in from high net worth under the kind of high net migrant category that there was. Well already a change of settings from the beginning of last year announced at the Auckland business chamber I might add. We've got $3.3 billion committed to several hundred, right. And the multiply effect is massive And it's not going to stop there. Right. So that is literally billions coming in these people, to use your phrase, of voting with their feet. They're going to want to be in the, the Foundry's. They're going to want to be in the Bledisloe Houses the, you know, staying at the Radisson Reds, you name it. So I'm pretty from a period of some pessimism. I talked about optimistic realism. I am relatively bullish for sort of 2027, 2028, 2029 and beyond.

[00:14:25] Viv: Yep.

[00:14:48] Todd: Sure.

[00:15:41] Todd: Yeah, that's great to hear, it's, like, just in our world we're seeing the very best of the office space market being extremely tightly held. So if you think of where we at the moment, our building is completely full, but next door is completely full. You know, rents are going up and obviously it's occupier that's, it's an issue. But as a, I guess as a

[00:15:58] Todd: As an Auckland and a service provider, you know, we want to see, you know, we want to see investment and for that to happen you need to see quality new projects coming out of the ground and I know this paper was about Wynyard, but we are seeing a lot of other opportunities for investors to come in, you know, on the fringes of Auckland as well. You know, we've got Keppel, which is a big Singaporean investor, investing with Precinct on a student accommodation asset. We've also got another project on Queen Street, which we're looking for a Capital Partner I'm in Hong Kong and Singapore next week to discuss that and the feedback we've had from the investors. You know, hit rate for a meeting is 80%.

[00:16:35] Todd: I think all the reasons you talked about and also I think we start to see the bigger Australian Eastern coast cities, Sydney and particularly Brisbane are really expensive.

[00:16:57] Todd: It's a good time to buy. Yeah.

[00:17:32] Todd: Definitely.

[00:17:48] Simon: apologist at any level. They have slowly, you know, people can argue about if we've got on top of those things.

[00:17:57] Simon: Correct, Viv deserves a lot of credit for, you know, going at some of these things. You know, we've seen a bunch of announcements, move on orders, police powers and so on. It's slowly but surely getting on top of that. I mean, I think for a lot of people listening maybe if they're in Australia, if they're in other parts of the world, you know, we can get, negative news sells, you can get these stories about Kiwi exodus and so on. But the other side of it, as I say, is the Asians, the Europeans, the North Americans I'm talking to every week who come here, they can't believe their luck. They feel like they are in this undervalued stock that it's going to go well, they want to get out of you know, and I'm not making a comment myself on this, but, you know, Trump's America or, you know, a Malaysian Europe, more uncertainty in Asia. So I, I feel very.

[00:18:44] Simon: Let's just face it, it's clean, green.

[00:18:50] Todd: You know.

[00:18:52] Simon: Outstanding amenity.

[00:18:55] Todd: I want to touch on a project that's close that I guess our heart as a business and what I think is a really important project for Auckland is Smith & Caughey's.

[00:19:03] Todd: So we'll, you know we're taking that to market very soon. 140 years of history.

[00:19:09] Viv: Iconic property, fantastic location and I think to your point around sort of putting the jigsaw puzzle back together it feels like a really important piece.

[00:19:34] Todd: Yeah. We're not over from that are we?

[00:20:04] Viv: We know we've got a wee way to go. But it's definitely, definitely improving. And we're also, it's quite interesting because we've had such a great response to the recent, I'll come to Smith and Caughey's but the positivity of the investment news. The Queen's Arcade is a big step

[00:20:21] Viv: People are going, fantastic. That's a heritage, arcade. They're excited and positive about it. Faraday's is an exciting one. I just bumped into him this morning actually.

[00:20:30] Viv: He was wanting to tell me all about it.

[00:20:34] Viv: We've got Cartier coming. We've got other investments not yet announced, but the reality is, it is changing. And when you think about that, Smith and Caughey's site. I mean, it's beautiful. Heritage, iconic, all of the above but its location is fantastic.

[00:20:54] Viv: Absolutely. And I think.

[00:20:56] Viv: Yeah, I was just thinking I'm not sure. I mean, clearly the investors here are recognising the potential and it's harder for some of the street trading people until they see change probably if they haven't got such long pockets. But the reality is you can actually see, I mean, Victoria's opening today, which is somebody from the business that unfortunately closed, but that's looking fantastic.

[00:21:22] Simon: Reposition opportunities.

[00:21:34] Simon: What a grand old lady, if I can say that.

[00:21:37] Simon: But the point you made I just reinforce as background to it? I mean, Queen Street, Midtown. It's an overused word, but they are iconic, right? I mean, if we had a Monopoly board, in New Zealand, they would be the number one kind of assets I mean, they are still Mayfair and Park Lane

[00:21:56] Simon: They are still, Mayfair and Park Lane.

[00:22:13] Todd: And the Town Hall and The Arts Precinct.

[00:22:16] Simon: Correct, and I just, you know, we're not going to get to kind of sentimental on it. I'm gonna start tearing up Simon.

[00:22:35] Todd: Oh, here we go.

[00:22:43] Todd: Was there a mother?

[00:23:04] Todd: I've wowed you.

[00:23:06] Todd: Bamboozled maybe?

[00:23:09] Todd: Look, I think we're all passionate about it aren't we? And I think, you know, we've, I think we've all taken a few punches as a city and as passionate members of the community here. And I've, I'm excited about what's happening. I guess just to maybe wrap things up and I'm conscious that, you know, we don't want to bore people too much to death with our sentimentality. but maybe just give us a bit of a, jump yourself forward to 2030. and yeah, four years ahead

[00:23:41] Todd: Can you just paint a bit of a picture for us? Because I think it's sometimes it's hard for us to really, I guess, vision the future when you stuck in the day.

[00:23:58] Todd: More jobs, absolutely right.

[00:24:06] Todd: Go. Go.

[00:24:18] Viv: Think about Queen Street, Mid-town I see lots of people. I see a really vibrant arts and cultural scene. Really interesting retail, entertainment, hospitality in that area. because that's going to change, obviously, because, with more people living in that area and the student life, I can see sort of different aspects to Queen Street that will be different but lively and vibrant. So I actually, look ahead to that time with, you know, a lot of positivity and see a very vibrant place with a lot more people.

[00:24:49] Simon: Oh, that's a part we haven't talked about that is a very important. Full disclosure, I'm Chair of Eden Park. And, you know, as we sit here about to announce a big concert for a bit later in the year. So you can watch that space, Events are really critical.

[00:25:32] Todd: That's fantastic.

[00:25:33] Simon: I mean to your earlier question, I just think, you know, cities, like economies, they've got cycles or rhythms. You said not the sentimentality, nostalgia, but the reality is you go to mid 2000s. I reckon objectively, Auckland felt like a really first class international city. It was at a high, you know, whether it was America's Cups or just the buzz. It was a, it really felt great.

[00:26:39] Simon: Yeah, I would be very surprised if in 2030 we're not sort of feeling would be quite a different conversation, we'll probably be a bit smug. We'll probably be talking a bit, but I you know, I think it'll be looking really, really good.

[00:27:05] Todd: Not an AI crash.

[00:27:10] Todd: The value investors are investing.

[00:27:13] Todd: Aren't they?

[00:27:17] Viv: Thank you.

[00:27:31] Viv: And we should acknowledge, sorry, we should acknowledge the report,

[00:27:34] Viv: Because you actually brought all the threads that are going to make, get us to that point in 2030 together in a great report.

[00:27:52] Viv: Fantastic.

[00:27:56] Simon: He's been alright. He's got us here on time. We don't want to talk him up too much.

[00:28:08] Todd: Cheers.

[00:28:10] Viv: Thank you.