Press Release – Bayleys
The evolution of suburban retail and commercial hubs around city-fringe locations continues to gather momentum with the pending opening of a new 19 site venture in Rotorua next month.Retail hub development reflects moves to suburban locations
The evolution of suburban retail and commercial hubs around city-fringe locations continues to gather momentum – with the pending opening of a new 19 site venture in Rotorua next month.
The Redwood Centre some three kilometres east of Rotorua’s central business district sits on 15,003 square metres of land. Of the 19 ‘convenience retail’ sites on offer, 14 tenancies have been signed up in advance of the complex officially opening on February 1.
Within the complex is 4,200 square metres of retail shops, a 400 square metre medical centre and adjoining pharmacy, and a 400 square metre gymnasium. The site allows for 205 car parks – optimising shared usage periods throughout the day and into the evening.
The corner site sits at the intersection of roads leading into Rotorua’s central business district on one side, and the leisure-focused lakes district – encompassing the Blue and Green Lakes, lake Okareka and Lake Tarawera – on the other side. A New Zealand Transport Agency high volume traffic count recorded an annual average daily traffic flow of some 34,000 vehicles past the intersection.
Among the 14 tenants already signed up to the Redwoods hub are: Burger Fuel; independent liquor, butchery, bakery, fish, fruit and vegetable purveyors; a bike servicing workshop; and the former multi-practitioner physio’/medical clinic and pharmacy based at Owhata some four kilometres away.
The five remaining Redwood Centre sites available for lease range in size from 130 square metres to 297 square metres. One has been penciled in for a potential pizza outlet, with discussions currently on-going with a mix of both chain and standalone operators looking at taking up a tenancy. A second site has been allocated for a café operator – with similar discussions on-going with several franchise coffee chains and standalone operators in Rotorua.
Leasing opportunities at the Redwood Centre are being marketed by Bayleys Rotorua leasing specialist Mark Rendell, who said the remaining sites would suit high volume or lifestyle retail services such as a video outlet, hairdressing salon, niche computer sales or repair operator, drycleaner, ice cream parlour, Asian noodle bar, pet care shop, Lotto store, or health food specialist.
The Redwood Centre sites have annual ground rents starting from $250 per square metre, with annual operational budges of between $28 – $35 per square metre.
“New Zealand retailing has seen several development and geographic trends over the past decade – from the emergence of ‘big box’ retailing hubs attracting the likes of Farmers, Harvey Norman, and Noel Leeming, through to suburban retail convenience hubs such as the Redwood Centre,” he said.
“These smaller neighbourhood complexes are predominantly based around short stay retail experiences, and are based on the cornerstone of food and beverage purchases – both on-premise for the cafes and restaurants, or takeaway through the likes of bakeries, pizza parlours and of course liquor stores.
“From this retail core, social amenities are bolted on – which is where sociologists see the likes of medical centres, pharmacies, gymnasiums, and video stores come into their own,” Mr Rendell added.
“The strategy for suburban convenience retail hubs is to lease to complimentary businesses in what is known as a ‘jig-saw’ mode where individual pieces fit together to create a bigger picture.
“The most common example of this is your typical Saturday night in the suburbs in virtually every New Zealand city – where dad and the kids get sent ‘down the road’ by mum to purchase a DVD for the night and pick up the pizzas for dinner while they are doing that, and while he’s there, dad buys a six pack of beer and a bottle of wine to take home too.
“Or the other typical scenario on which retail convenience hubs are founded is to cater for the suburban housewife/mother who finds it time-efficient to drop off the dry cleaning, have a cut and blow wave at the hairdressing salon, meet friends for lunch at the café or restaurant, then pick up ingredients for dinner and head home – all without having to move the car from its one parking spot… and with no chance coming back to find a parking stuck on the windscreen.”
Mr Rendell expected the Redwood Centre to become the preferred retail convenience hub for suburban Lynmore in Rotorua and servicing the rural lakes district.
“From a town planning and business model perspective, construction of the Redwood Centre embraces three of the fundamental requirements for a success retail hub,” he said.
“Firstly, it is adjacent to a high traffic arterial road with easy access from a round-about. Secondly, it is the centre of a moderately affluent residential socio-economic catchment zone. And thirdly, it will serve a high-turnover transient customer base through the up-market holiday homes in the lakes district.”
Mr Rendell was confident of signing up the remaining seven leases by the middle of the year.