This article is part of the Regional Hotspots report. To find out more about the report and other hotspots, click here

Kelvin Grove, on the north-eastern outskirts of Palmerston North, has gradually been transformed from a semi-rural lifestyle area into a residential area. Like many of the other growth areas we have highlighted, Kelvin Grove offers more than just a place to live, with a mix of industrial and commercial businesses located within the area as well.

There is still room for further residential development in Kelvin Grove, and the Palmerston North City Council is also targeting growth in the neighbouring Whakarongo area on the northern side of State Highway 3. The continued spread of housing in this direction will increase demand for services and is likely to result in the expansion of existing retail and education facilities over time.

Palmerston North’s economy has benefited from strong growth in the agribusiness and agritech areas. These sectors are closely tied in with Massey University, which itself has enjoyed a substantial lift in international student numbers over the last 5-6 years.

One of the other business growth areas for Palmerston North has been wholesaling and distribution, with the city providing better access to lower North Island areas for firms than being sited in Wellington. Although improvements in the roading network north of Wellington could alter future business location decisions, we believe that the biggest effect will be a drift of industrial business away from Wellington to the cheaper alternatives of Kapiti and Horowhenua, rather than any major shift of growth from Palmerston North to Levin.

"Kelvin Grove has gradually transformed from a semi-rural lifestyle area into a residential area. There is still room for residential development in the area."

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