The business of George St

George St’s established cafes are popular but other businesses struggle for a foothold. Paul Mitchell reports on the trendy little Palmerston North street that’s easy to miss.

George St has a reputation as the Palmerston North Parnell, the trendiest cafe and shopping spot in town and a bastion of boutique owner-operated stores.

But a number of sites on the street have experienced a high turnover, particularly of cafes and restaurants in recent years, with competition from established players, high rents and variable foot traffic cited as possible reasons for this trend.

Cafe Cuba, Barista, Moxie’s Cafe. They’ve percolated into Palmerston North’s culture. Everyone who has spent time in the city knows them.

They were there at the very beginning of the city’s coffee scene, and in the past 20 years, they’ve set the tone for George St.

Books, boutiques, fashion and food, preferably from an independent small business. The natural interests of the espressofuelled trend-chaser. The street’s been shaped by the gravitational pull of cafe culture.

The street’s owner-operators, from retro op-shop Groovylicious’s Shaun Kay to Moxie’s Cafe’s Mike Waghorn, love the vibe.

There aren’t a lot of chain stores on George St, although it’s been the birthplace of at least one. Designer Melissa Williams-lamb kicked off Kilt there in 2003. Now it’s a nationwide women’s fashion chain with 13 stores across New Zealand.

In fact, after cafes, women’s fashion boutiques are George St’s stock and trade.

Anel Heyman is one of George St’s fresher faces, and she enthusiastically embraced the street’s culture and community when she took over the longrunning women’s fashion store Posh last year.

She says Posh paired nicely with her custom hat-making business, and they combined to become Mooinooi. The new name means ‘‘beautiful woman’’ in Heyman’s native Afrikaans.

George St suited her company just as well.

It feels like a slice of a fashionable, big-city, high street, nestling in a side street of Palmerston North’s CDB, she says.

From bright blocks of red and green by the library, to murals of plants and vines and the tattooed lamppost outside Ink, there’s a character there that speaks to her.

She feels it appeals to her customers too. They’re looking for a different experience to the retail chain stores, and The Plaza.

And they find it in the passionate, colourful, somewhat eccentric business owners of George St.

‘‘They’re bubbly people. You can always hear them laughing and talking to people [who] pop in and out,’’ Heyman says.

She says it’s the best thing, the street’s culture. George St regulars get to know the shop owners on a personal level.

Heyman says the cafes are central to that vibe. Tables of people chatting over lattes scattered around the street can’t help but set a relaxed and informal mood.

Many of her regulars will pop in whenever they’re out for a coffee to talk fashion, and shoot the breeze, she says.

They trust she’ll dole out fashion advice or help them find something special without pushing hard for a sale, and Heyman trusts they’ll come to her when they’re ready to buy a new addition to their wardrobe.

But some think the George St cafe scene has reached saturation point.

James Pettengill, owner of the now defunct Tomato Cafe, says that’s why George St is one of the most difficult spots to open a new restaurant or cafe in the city.

‘‘It’s overpopulated with competition and underpopulated with customers... [it’s] a death site.’’

Just under half of the 33 retail spaces on the street are cafe/ restaurants, and four of Tripadvisor’s top 10 Palmerston North cafes are well-established George St cafes.

And, Pettengill says, the perception of the area as a bustling cafe spot doesn’t match up with the actual foot traffic throughout the week.

‘‘If you look at it objectively, that street is a garden shredder of optimistic entrepreneurs’ life savings.’’

Pettengill sold Tomato Cafe last year but, in hindsight, he would have picked another location.

He says The Plaza Shopping Centre’s expansion, completed in 2010, pulled customers away from the area just as he was starting out, but the rent had been set based on the activity before that.

The Plaza’s expansion has also long been cited as a reason for Broadway Ave – once the city’s premier shopping street – going into the doldrums.

‘‘The basic problem is tenants are structurally disadvantaged by the commercial rents that ratchet up in good times, and never come down when the local economy cools,’’ Pettengill says.

By the end he was paying $1400 per week on rent.

‘‘After five years of working seven days a week continuously, for nothing, I decided I had to let it go.

‘‘You can’t possibly sell enough scones or poach enough eggs to get a surplus when you’re paying that kind of rent.’’

Moxie’s Cafe owner Mike Waghorn says it has always been hard for new cafes to get a foothold on the street.

‘‘The established places – Cafe Cuba, Barista, Jacko’s and us – have enough good regulars to get by. But it’s tough for anyone starting fresh.’’

Waghorn has owned Moxie’s for 12 years, and has seen a lot of businesses come and go.

‘‘I think I’m the only [cafe owner] who’s still the same operator as back then. Some places still have the same name, but different owners ... there’s been a lot of people who’ve lost money or moved on.’’

When Waghorn took over Moxie’s, the George St Deli was right across the road, but it has been four more businesses since, he says. That’s a new one roughly every two years on average.

Most recently it was Tomato, before becoming the Thai Kitchen.

At the other end of the street, next door to Cafe Cuba, a new business has opened up every two years on average, with Saigon Restaurant the latest to close down.

The street’s newest restaurant, Good Morning Vietnam, is stepping into the gap left by Saigon, opening last week.

Owner Van Cuong Doan says they know a few restaurants have come and gone in the same spot. He wasn’t concerned because Good Morning Vietnam’s community focus made it a different affair.

Hospitality New Zealand spokeswoman Rachael Shadbolt says, as a rule of thumb, hospitality businesses usually see a major change every three to five years.

There’s either a change in ownership, a ‘‘reinvigoration’’ involving renovations or rebranding, or the company goes out of business, she says.

City planner David Murphy says the churn on George St is natural attrition, and not a significant issue. A few changes now and then is a good thing, overall.

He expects the area will get a boost from council spending to improve the look of Cuba St, and open up the City Library from George St through to The Square.

Damian Thorne’s twin businesses on the street are an example of how hard success can be to predict. Despite being right next to each other, and with many of the same people involved, one is thriving and the other is on its knees.

It can be a capricious street for a business, he says.

‘‘One day it’s vibrant as anything, and another day you can blow tumbleweeds down it.’’

Thorne Coffee has earned a solid foundation of loyal customers. It is doing so well a second branch is opening on Princess St.

But its sister shop, Thorne Menswear, closed last week. It never gained as much traction as Thorne would’ve liked.

He thinks the mix of George St businesses is leaning too heavily towards hospitality, leading to unsteady flows of customers.

‘‘It’s almost off-balanced by restaurants. If they had more retail, people would have a reason to go there.

‘‘George St is really easily missed for some reason. It’s that little street that gets lost.’’

Groovylicious owner Shaun Kay says the fact the street can be so easy to miss, especially for outof-town visitors, has been a hot topic of discussion among store owners.

It’s not that people haven’t heard of George St. Kay says it’s fairly common to have visitors come in, saying they’d wandered off towards Pioneer Highway trying to find it until they finally asked for directions or pulled them up on their phone.

Despite some struggles business is fairly good on George St, Kay says, although there has been an unusually quiet patch since mid-december.

It’s one of the things Kay loves about the street’s sense of community, that they’ve got together to figure out why that’s happened.

‘‘We don’t want to look like Broadway, so we got proactive and talked about what we can do.’’

They’re tackling the problem with a simple solution first – discussing new signs with the Palmerston North City Council, and commissioning a local artist to design a hand-drawn map to George St to be handed out at visitor sites such as Te Manawa, the library and the information centre.

And Cafe Cuba owner Darlene Woodhead says it’s always hard to know which places will last.

‘‘It comes down to how you run it, and a little bit of luck. But in my opinion it’s all about the service. Even if the food’s average, when the service is amazing people will keep coming back.’’

‘‘If you look at it objectively, that street is a garden shredder of optimistic entrepreneurs’ life savings.’’ James Pettengill