Quiet Auckland city worries businesses
AUCKLAND: The return to office working has been slower after the second lockdown in Auckland, sparking fears for what that means for struggling businesses.
Foot traffic in Auckland last week was down about 40% under Alert Level 2.5 — comparatively better than the 50% drop in the first week of Level 2 in May.
The phased return to the office for about 130,000 workers in the city centre had so far appeared to be slower than the first time round, as expected, Heart of the City chief executive Viv Beck said. This resulted in a mixed bag of trading conditions.
Level 2.5 had already proved challenging for the about 1500 customerfacing retail businesses in the city centre, and there had already been an increase in store closures, including on Queen St, Ms Beck said.
‘‘It is a scenario where their costs are higher and their revenue is down,’’ she said, adding it was ‘‘heartbreaking’’ to see restaurants turn people away due to alert level capacity restrictions.
‘‘It does vary a bit depending on the businesses you talk to. [But] we know overall that it is very, very challenging.’’
Under Alert Level 2 the first time, spending in Auckland city centre was down 46% or $40 million compared with the corresponding time last year.
Heart of the City will receive sales data for the first week of Alert Level 2.5 later this week.
Under Alert Level 3 the first time round, spending across Auckland city was down more than 80%, resulting in a loss of $60 million. About $56 million was lost under Alert Level 3 most recently.
The 40% reduction in foot traffic in the city could be attributed to no domestic students about due to semester break, no tourists and international students and a number of office workers still working from home.
Fewer workers coming back to work in their CBD offices meant significantly less trading potential for businesses in the area. The delayed return to Alert Level 1 would likely mean a greater loss than $40 million under the current alert level as some workers continued to work from home until then.
‘‘There’s over 130,000 people a day that would normally be in there. There’s no question it has an impact on the businesses that are there largely to either service tourists, students and workers.’’
Stats NZ data showed that more than 40% of employed New Zealanders worked from home during lockdown Alert Levels 3 and 4 in April and May.
Almost a million New Zealanders did some work from home in the June quarter.
Over the weekend, Wynyard Quarter was busy and bustling, while there were queues outside Commercial Bay stores Tommy Hilfiger and Calvin Klein. It was quiet at Britomart and Takutai Square.
Some businesses in the CBD were busy, some were quiet, and this was also dependent on the day of the week .
Some businesses were quieter on weekdays than they were on the weekends, she said.
‘‘Some are busy, some aren’t, it varies a little bit and it is a bit of a mixture. Overall, this is now an extended period of restricted trading which is not going to be easy.’’
Heart of the City said it was trying to stimulate spending and activity in the centre, including by extending Restaurant Month deals into September.
Events and hospitality businesses were finding the return to Alert Level 2.5 the hardest, Ms
Beck said, having to keep gatherings and groups to a maximum of 10 people and operating in line with seated service, social distancing and having only single servers per table.
Auckland city centre had few retail vacancies before Covid19, she said, but now had them on the main Queen St strip and off smaller side streets such as High St.
She was concerned about more business closures. — The New Zealand Herald