Market Lens Snapshot
New Zealand | Q3 2026
July, August and September 2026
Asset Classes: Office Industrial Retail
At a glance
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Office and retail are shifting towards very short commitments. One in four office starts ran under twelve months; retail’s equivalent share more than doubled to 17.5%.
- Industrial’s higher average masks a mixed distribution. Its average term rose 12.8% year on year, but both the under-three-year share and the ten-years-plus share increased.
- Strong collection does not mean uniform retention. Industrial recorded the highest rent retention across all nine country–sector combinations. New Zealand retail retained the lowest share of tenants but the highest share of rent among the three retail markets.
Sector summary, Q3 2026
| Measure | Office | Industrial | Retail |
|---|---|---|---|
| Average starting lease term, Q3 2026 | 34.5 months | 40.0 months | 40.3 months |
| Change from Q3 2025 | −20.4% | +12.8% | −7.3% |
| Q3 starts under three years | 60% | 47.7% | 47.9% |
| Tenant retention | 78.3% | 79.6% | 70.3% |
| Rent retention | 85.1% | 91.1% | 83.1% |
| Average rent collection, Q3 2026 | 98.7% | 98.6% | 98.3% |
Lease lengths cover Q3 2026 starts. Retention compares September 2025 with September 2026. Average rent collection covers July–September 2026.
Lease lengths: shorter commitments gain share across all three sectors
Industrial lengthens year on year; office and retail shorten
Office recorded New Zealand’s shortest average starting term at 34.5 months, down 20.4% year on year and the lowest Q3 level in the series. Retail’s average also reached a Q3 low, falling 7.3% to 40.3 months. Industrial moved in the opposite direction, rising 12.8% to 40.0 months.
The quarterly and year-to-date comparisons qualify that picture. Office and industrial lengthened from Q2, but all three sectors’ January–September averages remained below the equivalent period in 2025. Industrial’s stronger Q3 had not offset the earlier quarters.
Against Q3 2019, the pre-pandemic baseline, office and industrial average starting terms have roughly halved. Office fell from 75.2 to 34.5 months (−54.1%), while industrial fell from 80.4 to 40.0 months (−50.3%). Retail terms were 37.4% shorter. This points to a substantially shorter commitment horizon than before the pandemic, even with industrial’s recent increase. Each period covers a different group of commencing leases, rather than the same leases tracked over time.
Average lease length (months)
By asset class, Q3 observations, 2019–2026. Hover or tap the chart to see values.
| Asset class | Q3 2026 vs Q2 2026 | Q3 2026 vs Q3 2025 | Jan–Sep 2026 vs Jan–Sep 2025 | Q3 2026 vs Q3 2019 |
|---|---|---|---|---|
| Office | +7% | -20.4% | -17.4% | -54.1% |
| Industrial | +9.9% | +12.8% | -1.7% | -50.3% |
| Retail | -1.6% | -7.3% | -16.3% | -37.4% |
Average starting lease length in months by asset class, Q3 observations from 2019 to 2026.
A higher average does not mean fewer short leases
60% of office leases starting in Q3 ran under three years, compared with 47.7% of industrial and 47.9% of retail starts. The share increased year on year in every sector.
Office and retail stand out for the growth in very short commitments. Office’s under-twelve-month share rose from 15.6% to 25%, while retail’s increased from 8.6% to 17.5%. In both sectors, the one-to-under-three-year share fell, showing that the shift was not simply towards one-to-three-year agreements.
Industrial demonstrates why the average and distribution need to be read together. Despite its higher average term, the share of starts under three years increased. Terms of ten years or more also gained share, while the three-to-under-five-year band contracted.
Industrial’s increase was not a uniform shift towards longer commitments. The average rose while short leases also gained share—so neither measure should be read alone.
Leases by term length
Distribution of starting lease terms (months), Q3 observations, 2019–2026. Select an asset class, then hover or tap a bar to see values.
Distribution of lease terms starting in Q3, by asset class, 2019–2026.
Terms under three years
Share of starting lease terms under 36 months, Q3 observations, 2019–2026. Hover or tap the chart to see values.
Share of starting terms under 36 months, Q3 each year.
| Asset class | Q3 2025 | Q1 2026 | Q2 2026 | Q3 2026 |
|---|---|---|---|---|
| Office | 55.3% | 58.2% | 55.7% | 60.0% |
| Industrial | 42.2% | 39.5% | 51.1% | 47.7% |
| Retail | 41.5% | 52.7% | 45.8% | 47.9% |
Market context: quality and flexibility matter
Office: The short-term shift sits alongside an uneven occupier market. CBRE’s Auckland Figures Q3 2026 describes demand focused on well-located, high-quality buildings. JLL recorded premium CBD vacancy of 2.1%, compared with 21.7% for secondary stock in Q2 2026. The national lease-length result should therefore not be read as evidence that all office assets face the same conditions.
Industrial: CBRE reported a pick-up in leasing activity alongside higher vacancy and greater pressure on incentives. That provides a competitive backdrop to the stronger Q3 average, rather than evidence of a uniform return to longer commitments.
Retail: CBRE described generally soft leasing conditions, with most centres recording stable or lower rents. The growth in very short starts is a further consideration for renewal planning, but the data does not establish why those terms were chosen.
These Auckland-focused indicators provide context for national results; they do not explain the term changes directly.
Tenant health: collection is strong, but retention separates the sectors
Q3 collection rates are closely grouped
Average rent collection was 98.7% for office, 98.6% for industrial and 98.3% for retail in Q3. Collection measures rent paid within thirty days of its due date. The narrow range contrasts with the larger differences in tenant and rent retention.
New Zealand: average rent collection rate
Percentage of rent paid within 30 days of the due date
| Asset class | Avg. Oct 2025–Sep 2026 | Avg. Q3 2026 | Sep 2026 |
|---|---|---|---|
| Office | 98.6% | 98.7% | 98.7% |
| Industrial | 98.7% | 98.6% | 98.5% |
| Retail | 98.3% | 98.3% | 98.3% |
Source: Re-Leased Market Lens, Tenant Health 2026. Retention: September 2025 to September 2026. Collection: October 2025 to September 2026.
This distinction matters: collecting rent due under existing agreements is different from retaining tenants and rental income over twelve months.
New Zealand: tenant and rent retention by sector
Source: Re-Leased Market Lens, Tenant Health 2026. Retention: September 2025 to September 2026. Collection: October 2025 to September 2026.
The retention gap is rent retention minus tenant retention, expressed in percentage points.
Industrial leads retention; retail shows the clearest contrast
Industrial led New Zealand with 79.6% tenant retention and 91.1% rent retention. Its rent-retention result was the highest of all nine country–sector combinations in the report. Office followed at 78.3% and 85.1%, respectively.
Retail recorded New Zealand’s lowest retention on both measures: 70.3% of tenants and 83.1% of rent. However, the cross-market comparison tells a more nuanced story: New Zealand had the lowest retail tenant retention but the highest retail rent retention of Australia, New Zealand and the UK.
Retail’s 12.8-percentage-point retention gap was the widest across the nine country–sector combinations covered. It shows that rent retention ran further ahead of tenant retention than in any other included country–sector combination.
A positive gap can reflect higher rents or additional space taken by retained tenants, but the mix of tenants staying and leaving can also influence the result.
Retail is the clearest example of why tenant and rent retention need to be read together. Its lower tenant-retention rate does not translate into the lowest retail rent retention across countries. The next question is which tenants departed and how much rent they represented—not an assumption that every retained tenant paid more. A positive retention gap does not, on its own, prove individual rent growth or rule out rent concessions.
Why this matters now: Re-Leased’s New Zealand Landlord Sentiment 2026 found that tenant retention had overtaken interest rates as landlords’ leading challenge. The performance data adds a benchmark to that concern: payment reliability remains strong, but continuity differs substantially by sector.
The takeaway
New Zealand’s clearest shift is towards shorter commitments, particularly at the very shortest end of office and retail leasing. Industrial’s higher average does not contradict that pattern: its share of starts under three years increased too.
Strong collection sits alongside different retention outcomes. Industrial leads both retention measures, while New Zealand retail retains the lowest proportion of tenants but the highest proportion of rent among the three retail markets. Tenant counts alone therefore give an incomplete picture of income continuity.
For landlords, the useful next step is to connect these benchmarks to their own portfolios: how much rent is attached to upcoming lease decisions, and what would it cost to retain or replace that income?
About the data
Market Lens draws on anonymised, aggregated data from Re-Leased’s platform. This snapshot covers New Zealand office, industrial and retail.
- Lease length measures the full starting term of leases commencing in the reporting period, not the remaining term of existing leases. Term-band shares are count-based, not rent-weighted.
- Tenant retention measures the percentage of tenants remaining after twelve months.
- Rent retention measures rent paid by retained tenants compared with the previous year.
- Rent collection measures the percentage of rent paid within thirty days of its due date.
- Retention gap is rent retention minus tenant retention, expressed in percentage points.
Lease lengths and tenant retention provide complementary views of portfolio performance, rather than tracking the same group of tenants. Figures are rounded, and historical results may be revised as data coverage expands.
Explore the full research
This snapshot draws on two Market Lens reports from Re-Leased: Lease Lengths in Focus | Q3 2026, examining starting lease terms across office, industrial and retail, and Tenant Health 2026, benchmarking rent collection, tenant retention and rent retention across New Zealand, Australia and the United Kingdom.
