Ponsonby Central from Brown St, where the restaurant was based. Photo / Google Maps
A restaurant in Auckland’s upmarket Ponsonby Central dining and retail precinct shut for six reasons, leaving creditors owed an estimated $78,000.
Patel & Co’s Pritesh Patel is the liquidator of AJDA, trading as Miss Istanbul Corner.
The Turkish restaurant had been trading from the food and retail premises founded a decade ago by developer Andy Davis.
The dine-in and takeaway restaurant got more than $69,000 from the Government in Covid wage subsidies but even that couldn’t keep it afloat more latterly.
Patel said Miss Istanbul Corner shut for these six reasons:
1. The cost of goods went up and some products have been unavailable for the last 24 months;
2. Many workers once based in the Ponsonby business precinct pre-pandemic now work from home and don’t shop or eat in that area any longer;
3. Car parking is limited for extended periods of time, making it less accessible to some people driving there;
4. Labour costs have gone up meaning it costs so much more to employ staff to run a restaurant;
5. More competition is now apparent in the Ponsonby Rd dining area, making it harder to attract diners;
6. Cyclone Gabrielle had a domino impact: some food supplies are limited while others are far more expensive.
“Prior to the liquidation, the business was already financially struggling with high overheads and staffing issues. Covid-19 pandemic lockdowns further aggravated the already dire financial position of the company,” Patel wrote on March 31.
When it shut, the business whose sole director and owner is Sandringham’s Shagufta Shania Hussein owed unsecured creditors $25,000.
The company owes Inland Revenue a small business loan of $15,000 as well as PAYE tax of $7500 and a further $3000 in GST.
Accident Compensation Corporation, landlord Ponsonby Central and the ANZ Bank are also listed as creditors along with Māngere’s Service Foods, small business financier Prospa New Zealand, Smart Power of Howick and Hamilton’s Food Chain.
Ponsonby Central is between Ponsonby Rd, Brown St and Richmond Rd.
Businesses with security over AJDA are Hancocks Wine, Spirit and Beer Merchants, Mt Roskill Cash N Carry and Coca-Cola Amatil (NZ) but Patel noted he had been advised there was no money owned to any of these creditors.
AJDA got Covid wage subsidies of more than $69,000 for three to four employees, seeking an initial grant and then various extensions, Work and Income shows.
Total assets available are listed at only $40.86.
David Williamson, a senior lecturer in AUT’s school of hospitality and tourism, said: “It just shows that many small businesses are so tight that major disruption like Covid and storms, etc can easily push them over the edge. It’s always the tax man that finally gets you.”
Restaurant Hub, which merged with NZME in 2016, had a review of Miss Istanbul Corner when it was still operating.
That said it served “simple, honest Turkish/Mediterranean iconic food. It’s all about quality, gorgeous big flavours and falling in love with the eats of Istanbul. With fresh and hearty tastes, each item on the menu is specially prepared in their open kitchen, visual entertainment, for sure. Have a look through their classic Turkish mains, mezzes, sweet delights and traditional Turkish drinks, so you are sure to see something you like, or just say ‘feed me’ to the chef and let the chef do all the choosing for you.”
Burgers, BBQ, grill, Mediterranean, Middle Eastern, salads and kebabs were the types of foods served, that said.
Ponsonby Central owner Andy Davis told the Herald today that the restaurant had traded from its site for about five years and owed only a few thousand dollars in back rent. Another restaurant business wanted to lease that space and he said he is confident he will rent it.
“This is only the second liquidation in Ponsonby Central since it was opened in 2012. It’s trading really well,” Davis said.
The precinct was “packed” on Saturday and had been short-listed for a national architecture award as well.
Online reviews of Miss Istanbul Corner in 2018 and 2019 said it couldn’t be faulted, was “amazing value” and “the best choice made.”
“Lovely gem of a restaurant in Ponsonby. It is family-run and serves authentic Turkish food. Their ‘feasts’ must be eaten and the two skewers can be of different meats. Parking is plentiful,” wrote one satisfied diner visiting from London.
Other Tripadviser reviews criticised hard seats, average-sized or cold meals, an unimaginative salad and rubbery cheese.
In a separate hospitality sector liquidation, the Crown’s NZ Insolvency and Trustee Services is now in charge of MY3K, which traded as Refinery Bar and Eatery, owned by Maurice Tawhai Karaitiana.
The Inland Revenue Commissioner applied to put the Paraparaumu business into liquidation on February 28. Unsecured creditors want $330,000. BOC, Bizcap, DB Breweries, Hardy Trade Supply, Music Ltd and Australia’s Metcash Trading appear as potential secured creditors in the initial report.
Liquorland, BCE Catering Equipment, Tasman Liquor Company, EC Credit Control, Joncol and Dolbert Cooper appear as unsecured creditors.
Insolvency specialists Waterstones identified the food and hospitality sector as suffering the second highest failure rate (14 per cent) after construction (29 per cent).
“Building and construction liquidation numbers lead the pack over other industries, making up nearly a third of the total liquidations for January and February 2023. This is likely a result of the cooling property market and we may see this ratio continue to grow in the upcoming months,” Waterstones said in its March newsletter.
The Herald reported last year that more Auckland restaurants had joined the growing list of closures as Covid-19 continues to hit the hospitality industry.
Elijah Blue, an eatery overlooking the water near Hobsonville Marina, went into liquidation in December because of “the effect of Covid-19 on the hospitality industry” and issues with the lease, where the business was unable to operate to capacity, liquidator Grant Reynolds’ first report stated.
A bar and cafe in New Zealand’s biggest shopping centre chain failed lately with a shooting blamed for keeping terrified customers away from one. Patel is also liquidating AVS Investments 108, trading as Republic Bar & Kitchen Manukau in Scentre’s Westfield Manukau and Ara Cafe, trading as Presshouse Coffee in Westfield St Lukes.
Four Wellington bars have also been declared insolvent, with IRD, ACC, many businesses and employees owed money. Birdcage on Dixon St, Allen St’s Love Not Lost, Willis St Press Hall’s Amador and Serious Happiness in Newtown are in liquidation.
Reserve Bank says leaving banks to their own devices hasn't worked.