Hundreds of millions of dollars is expected to be invested in large-scale industrial property developments as growth in New Zealand’s primary export sector drives demand for logistics, cold storage and distribution infrastructure.
Latest Ministry for Primary Industries forecasts show food and fibre export revenue is projected to reach $62 billion in the year to June 30, up about 3% on the previous year and around 16% higher than two years ago.
The increase is being driven by growth in dairy, meat, forestry and horticulture, placing additional pressure on warehousing capacity, temperature-controlled storage and national freight networks.
Calder Stewart property director Ben Stewart says the company is seeing strong momentum across its development pipeline.
He says if current projects proceed as planned, the volume of upcoming work could double over the next three to five years as supply chain demand increases.
Over the past three years, Calder Stewart has delivered more than $1.5 billion worth of projects, including more than 750,000 square metres of industrial buildings nationwide.
“When primary production is strong, the entire food supply chain needs staging, temperature-controlled storage and distribution capability. Cold storage is one of the most active areas of investment, particularly off the back of dairy and meat export growth.”
Stewart says demand is particularly strong in Auckland, driven by exporters as well as retail and trade suppliers upgrading and consolidating distribution networks.
He points to NZ Safety Blackwoods’ automated distribution centre at Drury South Crossing as an example of the shift.
The 18,000-square-metre facility consolidates four North Island operations into a single hub and incorporates robotic storage and retrieval systems to improve throughput and accuracy.
NZ Safety Blackwoods, owned by Australian-listed Wesfarmers, supplies safety equipment, engineering consumables and industrial products to construction, manufacturing and infrastructure operators nationwide.
Stewart says the project reflects wider structural changes in the sector.
“We’re seeing smaller distribution sites consolidated into larger, centralised hubs. At the same time, businesses are investing more heavily in automation and focusing on efficiency and resilience.”
He says facilities of this scale are a critical part of the construction supply chain.
“Construction sites rely on consistent access to safety equipment and essential consumables. When supply chains work well, productivity improves across the sector.”
Stewart says combining automation with consolidation improves responsiveness to large infrastructure and commercial building programmes.
The Drury South asset was sold by Calder Stewart for $66.5 million to FortHill Property in late 2024 and is expected to be revalued closer to $70 million after its first valuation cycle, reflecting ongoing investor demand for modern industrial assets tied to essential sectors.
“This is one of the largest industrial expansions in New Zealand. When companies commit capital at this level, particularly into automation, it reflects long-term confidence in demand and in the strength of the construction pipeline.”
Stewart says land availability is shaping development decisions, particularly in Auckland’s logistics corridors.
“We’re seeing consolidation into newer, larger facilities as occupiers look to improve inventory management and operate more efficiently. Automation is increasing storage density and speeding up fulfilment, and that is reshaping how warehouses are designed.”
“With limited green field sites coming online in strategic locations, opportunities to secure scale do not arise frequently and when they become available, businesses tend to act quickly.”
He says those constraints are leading to taller, more advanced buildings, with high-bay and ultra high-bay warehouses allowing businesses to expand vertically.
“With land scarce, building up makes sense because automation allows higher-density storage while maintaining efficiency.”
Stewart says Calder Stewart employs more than 500 people nationally and could increase its workforce by 15% to 20% if activity continues at current levels.
Large industrial builds also support hundreds of subcontractors and specialist trades during peak construction.
“A lift of that scale would equate to roughly 75 to 100 additional roles across the country, spanning project management, engineering, construction and support functions,” he says.
The company holds about 900 hectares of industrial-zoned land nationwide and has further developments planned across Auckland and the South Island over the next two years.
Longer-term projects include Awarua Quadrant and Milburn Quadrant, which are aimed at strengthening freight connectivity and integrating renewable energy capability.
“These are long-term infrastructure decisions, and when businesses commit to facilities of this scale they are backing sustained economic activity that can also help attract other large players into the market.”
