Spending slumps 22% on Auckland's K Rd, businesses pin hopes on City Rail Link opening next year

NZ Herald

6 days ago

Some weeks, the octogenarian hasn't made enough to pay her rent to the Methodist Church, which owns her building. She's scraping by on income from properties she bought during better times, but predicts business will pick up 'after the doom and gloom of winter'.
Helen McIntyre outside her shop Buana Satu on K Rd. Photo / Jason Dorday
The numbers paint a stark picture. Council data shows card spending on K Rd dropped 22.5% between April/May 2024 and the same period this year. The Karangahape Rd Business Association reports slightly better figures – down 16% in some months, and 9.3% for the year to June. Either way, the figures are bleak.
McIntyre blames not just the economy, but also years of the street being dug up from construction projects, the removal of car parks and a rise in anti-social behaviour.
The disruption started with the $30 million 'Karangahape Rd Enhancement' project, which took several years and included a cycleway and rainbow-coloured overbridge; there has been the furore over removing car parks in late 2023, and Project K to upgrade streets around the City Rail Link.
'We've got I don't know how many bus stops, but hardly any parking,' McIntyre says.
'People want to come here, grab a bite, do some shopping, not pay $20 to $30 to park.'
She points to Wilson's parking on nearby Cross St. 'It's awful and expensive. People just go somewhere else.'
Still, she insists K Rd remains a 'good little community', even if most businesses are struggling.
Not every business is struggling, however. At Paperbag Princess, a recycled clothing store, manager Chloe Bailey says some Saturdays are 'a sensory nightmare' thanks to the crowds.
'On a good day, the store is packed,' she says. Most items are priced between $18 and $20, but even that can be a stretch for some customers.
Paperbag Princess staff Chloe Bailey and Ruben Cirilovic say that on a good day, the recycled clothes shop is packed. Photo / Jason Dorday
'People don't have the luxury of money or time,' adds her colleague Ruben Cirilovic, saying the new Western Express bus service hasn't brought the foot traffic many hoped for.
Jamey Holloway, general manager of the K Rd Business Association, is the street's unofficial cheerleader.
He disputes the council's city centre data figures showing a 22.5% drop in card spending over the past year from data by Marketview, which tracks consumer spending for the council and the business association.
According to Marketview data for the business association, the drop in spending was more modest in May and June – down 7% and 9.3% respectively compared to the same months last year. Parnell and Ponsonby had similar declines in June, Holloway says.
Council data paints a broader picture, showing a 6.6% fall in card spending across six central precincts between April and May this year, compared to the same period in 2024. Karangahape led the downturn with a 22% drop, followed by Wynyard Quarter at 10.8% - a figure likely influenced by the closure of the key pedestrian bridge during much of that time.
A council spokeswoman noted that the business association's data covered a wider area and included 50 more stores, many of which outperformed those common to both datasets. The difference in coverage, she says, helps explain the variation in reported figures.
Holloway noted that K Rd's spending data doesn't capture large non-card transactions, like buying a vehicle or a painting from one of the many art galleries along K Rd. The area also lacks grocery and petrol spending, which props up figures in other parts of the city.
Business is tough along K Rd. Photo / Jason Dorday
The biggest discrepancies, he says, were last winter when interest rates started to bite, and there were months when spending was down 16% – 'slowly we are clawing back'.
Holloway says one sector where people are spending less money is restaurants, a view shared by the council's economic development office head, Pam Ford, quoting figures showing hospitality spending – covering cafes, bars and restaurants – has taken a notable hit.
Between July and December last year, Karangahape had a 20.7% drop in this category, compared to a 6.8% decline across the wider city centre, she said.
In August last year, popular Peruvian restaurant Madame George announced its closure, citing the economic downturn making it 'impossible' to continue.
Bar Celeste, on Viva's list of Top 60 Restaurants in Auckland, closed in June this year; and last month, Candela announced it was closing at the end of August and being replaced by the second Auckland outpost of Benny's American Burger. Candela was crowned Supreme Winner of Viva's Top 50 Auckland Restaurants in 2022.
Bar Celeste closed in June this year. Photo / Babiche Martens
The narrow K Rd restaurant Flor closed a year ago. Herald food critic Kim Knight called it a wondrous restaurant, where everything the chefs touch turns to gold.
'Please let this be for keeps because I want to eat here again and again and again,' she wrote in March last year. A few months later, it was closed.
Owner Dan Gillett blames a big downturn in business, saying Flor was busy on Thursday, Friday and Saturday nights, but not the rest of the week.
Gillett has also closed a wine shop focused on organic, biodynamic and natural wines after finding customers were opting to buy online and choosing delivery instead of shopping in the store on K Rd.
The physical business was not viable, says Gillett, whose business is now entirely online.
As for the reported 22.5% drop in spending on the strip, Gillett doesn't dispute it. 'It's probably fair, maybe even an understatement.
'Three to five years ago, K Rd was cool and vibrant. Amazing restaurants were opening,' he says, recalling (Herald restaurant critic) Jesse Mulligan writing that K Rd was becoming the city's best dining destination.
These days, Gillett says, visiting K Rd is 'a pain in the arse', pointing the finger at the new street layout, which he believes has attracted 'drunks, druggies and rough sleepers'.
K Rd Business Association general manager Jamey Holloway says the City Rail Link will be transformative for the famous street. Photo / Jason Dorday
Asked about anti-social behaviour on K Rd, Holloway says the street has always had a spicy reputation, but safety remains a recurring concern.
Last year, concerns over crime and safety bubbled to the surface, prompting locals to raise the issue directly with Police Minister Mark Mitchell. At the heart of the unease was a newly opened City Mission-run facility on Day St, housing 60 residents, half of whom were considered high-needs.
Over the past year, the City Mission, which has around-the-clock security and a support worker at the Day St facility, said it had continued to work with the K Rd community on issues that arise, and the police were not aware of an increase in anti-social behaviour.
While the initial turbulence around the facility has since calmed, according to Holloway, new challenges have emerged. The removal of emergency housing across the city has led to a visible rise in rough sleeping, with about 10 people now living on the street in the K Rd area. 'It brings challenges,' he says.
Property owner Muy Chhour remains unconvinced that the area has fully turned a corner. She believes more needs to be done to make visitors feel safe and is calling for a reduction in the proportion of high-needs residents at the Day St facility – from 50% to 20%.
Chhour, whose father established an Asian supermarket on K Rd and owns the landmark Rendells Building, is not surprised that spending is down 22%, a view echoed by St Pierres Sushi marketing director Nick Katsoulis and Hemp Store manager Chris Fowlie.
Katsoulis, part-owner of the nationwide chain of St Pierres Sushi stores, says: 'Many offices seem to have vacated the K Rd area, and the combination of roadworks and gradual reduction in parking availability has likely been the main reason for the decline.'
It's been a bleak winter on K Rd. Photo / Jason Dorday
Fowlie says the 22% drop in card spending feels about right, saying the night economy is doing quite well, but the day economy is struggling.
Still, Fowlie sees a silver lining. 'K Rd isn't completely screwed,' he says. It's unique, it gets compliments, and events still happen. But perceptions matter. People think it's hard to get here, and everyone is struggling."
He likes the improvements along K Rd – wider footpaths, the cycleway, greenery and shrubs - but says parking is a big issue, and he's frustrated by the slow pace of work, including the year-long construction on a 50m stretch of Mercury Lane that's 'not anywhere near finished'.
'I'm not sure what the magic wand is,' admits the store manager, who believes the street needs a serious rethink to become a destination rather than just a thoroughfare. Right now, K Rd risks becoming a place people rush through, rather than linger in.
Fowlie is concerned that the area's role as a major bus and transport corridor could shape its identity in an unintended way.
'One of the risks of being a bus corridor and transport route is that you end up with a few convenience stores around the station entrances.
'Public transport centres around the world are not renowned for being particularly nice. They are usually pretty depressed and crappy and full of rubbish and down-and-out people. We have to have a serious think, so we don't end up like that around the CRL stations.'
Fowlie says businesses are clinging to the hope that the CRL will bring a wave of revitalisation. But he also warns that the rail link's arrival will trigger fresh development, and with it, more years of construction and disruption.
Hemp Store manager Chris Fowlie. Photo / Jason Dorday
Holloway says Fowlie is not wrong about post-CRL development, but hopes the new construction will be in chunks that are easier to chew.
After years of disruption and delays to the CRL – now pushed back from its original 2024 opening to mid-2026 – K Rd businesses are bracing for yet another challenging year. 'It'll feel like another round in a boxing match,' Holloway says.
Adding to the pressure is the persistent sight of empty storefronts. 'There are 23 shops up for lease,' Holloway notes, a figure that mirrors 2022 levels, and a source of sleepless nights in the battle to restore vibrancy.
In anticipation of the CRL, new businesses are moving in: Toa Architects, bars A Space and Frog; Mexican restaurant Sagrado Cantina, and art galleries Coastal Signs and Charles Ninow.
And yesterday, it was announced that a $100 million, 11-storey timber office building near the Ponsonby Rd end of K Rd would go ahead after an agreement was reached between the developers and the council. Independent planning commissioners had previously rejected the plans.
'The CRL is going to be transformative,' Holloway says. 'It's the point at which Pinocchio becomes a real boy and Auckland becomes a real city.'
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