Why West Auckland needs the $160m monster mall

Christmas shoppers at Westfield St Lukes mall - Auckland's growing northwest is one of the least developed for high quality retail space, say developers. Photo / Chris Gorman

• NorthWest: vast new internal west Auckland mall opens October 1
• Where: rising at Westgate Town Centre, new 56ha development
• New Mitre 10 and Pak'nSave already opened nearby
• NorthWest is 100 new shops including Farmers and Countdown
• New Auckland mall's catchment richer and younger than many other areas

Nearly half a million Aucklanders living within a 15-minute drive of the new $160 million mall named "NorthWest" are currently underserved by existing shops, say its developers.

And its prospective customers will not only be younger than in many other areas, but they will also be richer.

DNZ Property Fund, building the 2.7ha 100-shop mall which is a third of a kilometre long, the size of four rugby fields and opens on October 1, explained its rationale for the development, citing lack of retail offerings in the area between the suburbs of Hobsonville and Henderson.

Young, affluent and undermalled?

"Approximately 475,000 people live within a 15-minute drive of Westgate and the population within the primary catchment is forecast to grow rapidly with the completion of the fast-tracked residential developments such as Hobsonville Point," DNZ said.

The area will attract shoppers from a "total trade area of some 220,000 people, including over 65,000 residents in the primary catchment. The average age of the primary catchment area is 32.6 years, three years younger than the New Zealand average and is well represented in the key 15-39 year age group. Retail expenditure by total trade area residents is projected to increase from $2.5 billion in 2013 to $4.4 billion in 2026, representing an average annual growth rate of 4.5 per cent per annum."

Residents in the area surrounding the new $1 billion Westgate Town Centre where NorthWest has risen appear to have plentiful cash but fewer nearby shops than other parts of Auckland.

"Not only is the total trade area one of the most affluent in New Zealand in terms of available retail spend, it is also one of the least developed in terms of the provision of high quality retail space," DNZ said.

MacroPlan Dimasi, a commercial property consultancy company - which worked with DNZ on the NorthWest, also pointed to the west's untapped wealth and lack of shops.

"The socio-demographic profile of the Westgate Town Centre trade area is characterised by New Zealand-born families who typically earn above average per capita and average household incomes. The estimated provision of retail floorspace within the Westgate Town Centre main trade area of approximately 0.44sq m per resident is significantly lower than the estimated rate of provision across metropolitan Auckland of 1.5sq m per person. This reflects the somewhat under-developed nature of the main trade area," it said.

DNZ Property Fund chief executive Peter Alexander (left) and centre manager Jennifer Andrews stand in the new NorthWest Shopping Centre at Westgate, due to open October 1.

DNZ said NorthWest would "form the heart of the new regional town centre" at the intersection of the North Western and Upper Harbour Motorways. Even with the new mall, plans indicate not enough shops would be provided in the area and far more are planned at Westgate Town Centre.

Campbell Barbour, general manager of NZ Retail Property Group which owns the Westgate land, said about 40,000 new houses were forecast to rise in the immediate vicinity. All those new households would need appliances, furniture, clothing and other items, he said, so new shops were a crucial part of the area's expansion.

Barbour said Auckland's northwest had for decades lacked a town centre. "West Harbour, Greenhithe, Hobsonville got built but there was never a town," Barbour said.

Westgate Town Centre is New Zealand's biggest new urban hub, equivalent to a new Manukau or Albany, set on a 56ha site at the end of the Northwestern Motorway.

After the Herald published yesterday's article announcing the mall's imminent opening, readers asked whether Auckland needed another shopping centre, why people liked to shop and what were the reasons driving our consumer-based society.

But DNZ chief executive Peter Alexander said that area of Auckland had never had a major shopping centre like NorthWest and the strength of demand could be graphically illustrated by extremely strong leasing: all 100 shops has been pre-let well before opening and only a portion of the commercial or office space remains to be leased.

The level of pre-commitment delighted institutional investors in DNZ, listed on the NZX, he said.

Aerial view of the Northwest Shopping Centre, part of the new Westgate Town Centre. File photo.

Farmers has committed to one of its biggest New Zealand stores, at 8000sq m or nearly 1ha, spread over two levels, Alexander said, and a Countdown supermarket will also open.

Farmers' owner David Norman praised NorthWest: "The DNZ Westgate project presents a significant opportunity for Farmers to open a flagship store. Our proposed footprint of 8000sq m will be one of the largest in our group and demonstrates our confidence in Westgate as a retailing location. We have been monitoring this area for many years due to the strong catchment characteristics and exceptional growth prospects that exist," Norman said.

Adrian Walker, Countdown's property general manager, described the area as a "growing community" and said his group saw value there.

Earlier this year, Auditor-General Lyn Provost began an inquiry into Auckland Council's involvement in Westgate Town Centre, costing ratepayers about $200 million. The inquiry follows concerns raised with the Office of the Auditor-General about the way the project was established by the former Waitakere City Council and is being managed.
Her report is yet to be released.

Mall tipped as new community hub

RCG director Desmond Wai said the $160 million monster west Auckland mall would be beneficial for the local community.

"I actually think that new Northwest centre will be a new community hub. It will be essentially a [community] anchor and it should grow the overall environment.

"It is going to create more jobs, and employment opportunities and it is going to change the dynamic of traffic flows because there are a lot of people who are actually living out West and people are moving further afield," Wai said. "In time, hopefully they won't have to travel into the CBD."

Wai said he did not think there were too many malls in Auckland and the creation of the new Westgate mall would not put other shops out of business.

"With what is happening with the unitary plan and with the Auckland growth rate, I think it will be a very successful centre," he said.

"If we compare [the number of malls] to overseas, the CBD has its heart, a tourism market and CBD office workers, while the Westgate area is very much a community hub and it's going to service the local community, local businesses and a growing residential market.

"It is just allowing for future growth in Auckland. We can't [continue] to grow within the existing confines of the CBD and it is a lot more cost effective to actually grow around the city. Westgate is one of those areas that has the opportunity to do that."

Wai said the current traditional closed in structure of the mall would change over time and become more focused on the external environment.

"That is only the first portion of the hub that is going to be created, yes that will be covered but there is going to be further retail which is going to be more externally focused and is probably going to have a lot more community services," Wai said.

"That mix and that type of environment with be different but I think it needs to be complimented with a covered mall environment."