Kirks site ‘too good to miss’

THE ‘‘appetite’’ for luxury goods and big spending habits of Wellingtonians was a catalyst for attracting David Jones to the capital.

Kirkcaldie & Stains said June that it would close February after 152 years business.

David Jones will pay A$500,000 (NZ$554,900) for the Kirkcaldie & Stains name and to take over the lease on its Lambton Quay building.

David Jones head of property Cristie Gordon gave a presentation at an event hosted by the Property Institute in Wellington.

The Kirks site had excellent foot traffic and was too good an opportunity to miss, he said.

Gordon gave several reasons why Wellington was chosen over Auckland.

David Jones would have no direct competition and there was immediate opportunity to acquire a property for a contemporary store.

Kirkcaldie & Stains was available and trading satisfactorily and prime for improved performance through an injection of capital.

First Retail Group managing director Chris Wilkinson said it was made clear the company was intent on bedding in Wellington fully, before considering other options.

David Jones used Kirkcaldies sales data and market experience to learn about Wellington’s unique demographic, which helped cement its decision to open in the capital, he said.

‘‘David Jones wants to bring luxury brands to New Zealand and in Wellington there is an appetite for it,’’ Wilkinson said.

Wellingtonians also ticked off benchmarks: consumers had confidence in the local economy, people were well educated, home ownership was strong, house values were rising and unemployment was still relatively modest. in in in From Kirkcaldie & Stains to David Jones: $20m refurbishment starts on February 1 and the new store is expected to open ‘‘mid-2016’’. Floor to ceiling display windows around the store perimeter. Escalators to connect upper floors. The cafe would remain but there are no further plans for food at this stage. The store perspectives retain Kirkcaldie & Stains’ heritage features with sympathetic signage and tones.

David Jones was also impressed by the tourism industry, particularly the cruise sector.

Wellington’s cruise business was bringing in about $50 million in retail spending to the CBD. Growth in ship size and ship numbers would increase this, he said.

The Wellington City Council had also helped the store make a decision by appointing a dedicated case manager to deal with consents and red tape issues, Wilkinson said.

Of the challenges, Gordon said the building was about half the size of a typical David Jones department store, which limited space and storage. This would make it difficult to implement its ‘‘stock into store’’ model direct from suppliers.

Before a takeover by Woolworths South Africa, David Jones would not have been in a position to move to New Zealand because of financial constraint. The fresh injection of funds, strategy and confidence had helped the business grow, Gordon said.

Wilkinson expected David Jones would significantly improve footfall and sales for surrounding businesses – much like Topshop had achieved for Queen St in Auckland.