Nic Watt in his new restaurant Huami for Sky City. Photo / Babiche Martens
Nic Watt in his new restaurant Huami for Sky City. Photo / Babiche Martens
Another day, another restaurant opening - the hospitality trade is booming, and America's Cup victory is tipped to put more wind in the sector's sails.
But the surge in new eateries, some of which cost millions of dollars to set up, is raising concerns about sustainability, and whether changed immigration rules will hamper an industry forecast to need another 10,000 workers in the next five years.
Hospitality New Zealand chief executive Vicki Lee said restaurateurs were making the most of a market that had been in good shape for the past few years.
Statistics NZ figures show spending on restaurants and cafes in the Auckland region - which accounts for about two-thirds of the national total - increased to $1.91 billion in the year to the end of March, up from $1.71b three years ago. Ten years ago, spending in Auckland was $1.1b.
The Lula Inn in the city's Viaduct area opened a few weeks ago and SkyCity's most recent addition, Huami, opened last weekend with street entertainment and music.
Add in Gerome and Barulho in Parnell, Hugo's on Shortland St, Giraffe and Headquarters in the Viaduct, to name a few, and it has been a busy few months.
Lee said the boom was likely to be a mix of new businesses and restaurant churn.
"The average lifespan of a hospitality business is approximately three to five years before a product either changes hands or is refreshed or reinvented," she said.
"The public can be fickle and they expect new, fresh hospo experiences, which is why hospitality businesses are always looking to refresh or reinvent themselves - be it the decor, a complete reinvention or new offerings on the menu."
There were exceptions, however: the likes of Euro, One Tree Grill and Harbourside have been around for years.
Developing a new restaurant can be a costly business.
SkyCity won't reveal how much was invested in Huami, launched in collaboration with chef Nic Watt, other than to say it was "significant".
However, the fit-out for Watt's earlier restaurant, Masu, also at SkyCity, was widely rumoured to have cost about $7 million.
Lee said set-up costs could vary significantly, but a rule of thumb for a premium establishment was about $2m to $3m.
The America's Cup defences of 2000 and 2003 helped drive the development of Auckland's Viaduct Basin, which Lee said had provided a great location for some of the city's best restaurants, which now extended all the way down to the Wynyard Quarter.
"The America's Cup event generally attracts high net worth individuals and this then creates an opportunity. No doubt they will want to enjoy fine New Zealand wine and great local cuisine so the hospitality industry will benefit here," she said.
Restaurant New Zealand chief executive Marisa Bidois said the boom was great news for the industry, but sustaining it could be difficult.
"We have seen a massive surge in businesses opening. Whether or not we have the population to sustain all the new businesses that are opening is another question," she said.
"Events like the America's Cup and the Lions tour will certainly help with that, which is good news for the industry in terms of trying to remain sustainable long term."
Hospitality New Zealand CEO Vicki Lee. Photo / Supplied
The America's Cup could also help restaurants if a cooling Auckland housing market affected discretionary spending - crucial to dining out.
"Everything goes in cycles and when people feel prosperous - their house prices may have gone up or the dairy payout is better than expected - you do see discretionary spend increase," Lee said.
"Likewise, when the cycle dips you see people pull their belts in. With an event like the America's Cup, the type of overseas visitor it attracts aren't usually impacted by blips in local economies."
Bidois said the industry typically went through booms and busts, with the last recession forcing some restaurants to close their doors.
But "people are becoming more aware of cuisine and they're making dining out part of their social fabric now whereas 10 or 20 years ago that wasn't the case," Bidois said.
"There's so many different options these days and different price points for dining out, that anyone in any economic section of society can engage with restaurants in some way."
Danny Bucalo, general manager food and beverage at SkyCity Auckland, said there was a growing appreciation and recognition of global cuisines, which restaurants were starting to reflect. And the increasing number of new restaurants did not necessarily result in significantly more competition, Bucalo said.
"Auckland's restaurant scene has always been competitive - you have to be on your game and deliver exceptional food and customer service to be successful over the longer term.
"[It] doesn't necessarily mean the industry is becoming more competitive; there's also a growing demand for quality and of course Auckland has a fast-growing population."
Lee said many Kiwi chefs had trained under international identities like Gordon Ramsay or Jamie Oliver and were bringing skills home to New Zealand.
Collaborations with guest chefs or restaurants were also a trend, she said, offering restaurants the chance to try something new without making costly changes.
However, there was a shortage of hospitality staff, which the Ministry of Business, Innovation and Employment forecasts will need 10,000 more people in the next five years.
"There simply aren't enough good Kiwi hospitality professionals to go around, so there is a reliance on migrant workers to fill those staffing gaps," she said.
Recent changes to immigration rules have the industry worried, especially if they significantly reduce access to good migrant workers, as tourist numbers are forecast to grow from 3.6 million a year to more than 5 million in the next six years.
"If we are inviting more visitors into the country to experience our fantastic hospitality and tourism product, we need to consider who is actually going to be there to look after them if our migrant workforce is no longer available and there simply aren't enough good hospitality Kiwis to do the job," said Lee.
