The new Fort St parklet is lively and welcoming, at least during the day. Photo / Supplied
OPINION
Many readers were outraged last week at my suggestion Queen St landlords are leaving their shops empty on purpose. "It's ludicrous to assert landlords want no yield on a prime asset", said some. "Simon Wilson must be living on another planet and it proves journalism has gone down the drain," was the gist of several more, only they did tend to be expressed in more colourful language.
The fact is, though, many landlords do choose to leave shops empty. They have several "financially rational" reasons for doing so.
• Preserving the value of the building
Real estate agents calculate the value of a commercial property by assessing how much rent it can generate. When a landlord reduces the rent, the value of the property, at least on paper, goes down.
In theory, a vacant shop could earn the same high rent it used to earn. But if it's let out for a lower rent, that proves the higher rental is no longer possible.
• Landlords don't want cheap tenants
I proposed last week that Queen St landlords should go to the retailers they like in other parts of town and offer them low-rent pop-ups. Failing that, I suggested they should populate the shops with whoever wants to give it a go.
But both ideas undercut the hopes of the upmarket stores already there, and of the business association Heart of the City. They want Queen St to be a "quality destination". They don't want pop-up stores, K Rd-style boutiques, market stalls or anything else that might lower the tone.
• They drove tenants away during Covid
Many retailers have told me stories of landlords that refused to offer rent relief during the Covid lockdowns. There were some who did, and good on them, but others did not.
• Absentee landlords can't be bothered
I've heard from business groups around town that have been pleading with absentee landlords to lease their empty shops. The owners don't care. They'll make their money when they sell or develop the property, but having tenants to look after now is just a hassle.
There are, however, some much more legitimate reasons some shops are empty.
• Landlords can't find tenants
Some landlords have tried in good faith to find tenants and will offer low rents. This shows individual landlords can't fix their problems on their own, but will have to work with each other and with council and its agencies: see below.
• They're doing up the building
Earthquake strengthening and other redevelopment projects have closed some buildings on Queen St. It's great their owners are doing this work and the closures will be temporary.
The hard fact is that Queen St is a failure of the market. When property owners believe it's in their interests to leave shops empty, and therefore contribute to the dereliction of the central city, they are helping to create a social crisis.
According to the complaints last week, though, the council and/or the Government are at fault, because they've removed car parks, dug up the roads, allowed crime to get out of hand, or have "an agenda to destroy business".
Let's look at those claims too.
The City Rail Link, when it's finished in 2025, will double rail capacity throughout Auckland. The dig should have been less disruptive but the project itself will be immensely valuable.
The work on Quay St and Te Komititanga – the bottom block of Queen St – has created a new pedestrian-focused precinct, right in the middle of the central transport hub, the city's major shopping zone and the public gateway to the waterfront. For recreation, commerce and transport, it's a significant benefit for the city.
The Queen St work has been stop/start, muddled and lacking vision. But Auckland Transport and council planners are losing control of that work: it will be completed under the leadership of the council's "place-making" agency, Eke Panuku.
Pedestrian areas have been widened in the top two blocks, by the town hall and the Civic, and greenery is soon to be installed. The rest is due for completion by the end of winter, although that may have been delayed by Omicron. It's not clear yet how good it's all going to look, as no new designs have been produced.
There's no question that construction work has disrupted retail activity in the central city or that it should have been better managed. But if roadworks were to blame for all the empty shops, Commercial Bay, which is still a construction site, would be in trouble too.
Covid has kept people away, that's obvious. Crime is doing that now too, which means we need more visible and effective policing, both to prevent crime and to boost public confidence. It's a serious issue.
But the larger solution for both the Covid stay-away and crime is to find ways to crowd Queen St with people. For that, we need things to attract them into the city. And that can't happen if the shops are empty.
It's notable that while Queen St is in trouble, there are crowds of shoppers and people enjoying themselves at Commercial Bay and Britomart, in the Freyberg Square/High St precinct, in the Viaduct and in other parts of the central city.
It's also notable the places that are thriving have something in common: they're car-free, or at least do not prioritise driving.
This hasn't stopped people from complaining that all would be well if Queen St was easier to drive through and all the car parks were reinstated.
It makes no sense at all. When people drive to Sylvia Park, Westfield or any other mall, they don't expect to park outside the shop they want to visit. Why should they on Queen St?
Parking right outside is small-town thinking, but Auckland is a big city. "Queen St was good in the 1970s," say regular letter writers to this paper. Actually, in the 1970s Queen St was already congested and Mayor Robbie was doing his best to get the street pedestrianised.
In cities around the world now, many of the main shopping streets are doing well: George St in Sydney, say, and Oxford St in London. They have that same thing in common: cars no longer clog them up. The model is the Strøget in Copenhagen, which made the change in 1962.
Thriving streets with high-quality shopping, which people get to using public transport.
What does Queen St need now? In a nutshell, open shops, street life and events. The recent City of Colour festival successfully brought a lot of people into the central city, but those things need the shops back too.
So the landlords have to work together. Bribe the retailers they want, do the pop-ups, bring in food trucks and outdoor seating, set out market stalls, hire the entertainment. Work with the festivals and sports teams. Get the universities to do regular lunchtime talks and debates. Do shopping competitions for office workers. Make it exceptionally lively.
And overcome their snobbery about "quality shops". If Queen St fills up because it's the best pop-up market and entertainment circus in town, that will encourage longer-term tenants to want some of the action too.
I do not understand why Heart of the City has not made this its top priority.
Second, council agencies need to step up, helping produce those integrated plans and also helping companies bring their work-from-home staff back into the city.
It's not just Eke Panuku: the council's City Centre Advisory Board, the local board and the ward councillor, the local MP and Auckland Transport all have a role.
Most of all, so does the Mayor. Phil Goff has a little over four months of his term left: how about saving the central city before you go, Phil?
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