City businesses paying rent with loans as ongoing construction takes its toll

Monday, 23 June 2025

Auckland Transport is building a bus interchange on Wellesley St West, and Watercare is working on water pipes beneath Queen St. Business owners say the works keep customers away and they are struggling to pay rent.

Business owners in Auckland city are borrowing money to pay their rent.

Construction on Wellesley St West is taking a toll on businesses.

One restaurant has closed permanently.

Central Auckland business owners are borrowing money to pay the rent while construction work outside their premises drags on.

Mohammad Raza Rahmati, and his daughter Rose Rahmati, opened Karadeniz Cafe on Wellesley St West in October 2024, then construction work started right outside.

“It’s crazy, we’re having to borrow a lot of money from our country to pay rent,” said Rose Rahmati at Karadeniz Cafe on Wellesley St West, in Auckland city.

Her father, Mohammad Raza Rahmati, put his life savings into the Turkish kebab shop which opened last October, she said.

But two weeks later, construction started on a bus interchange right outside.

Fencing on the corner of Elliott St and Wellesley St West directs pedestrians around construction work.

“The fencing was right up to the window,” and affected trade immediately, Rose said.

In their first week, the cafe’s takings were around $900 a day, but that dropped to around $20 a day when work started, she said.

“We lost the summer, the whole summer, everywhere was dusty and noisy, people said they don’t want to walk around Wellesley St.”

The doors have shut for good at Chawla's Indian Restaurant on Wellesley St West.

Her father is borrowing money from Iran to pay the $6000 a month rent, she said.

But as the work drag on, and with a limit to how much they can borrow, Rose said she is frustrated by the stress on her father.

“His business is being ruined,” she said.

Nessir Kardhom has seen an 80% drop in business since the works started eight months ago.

After opening at 6.30am, by 11am on Wednesday they had only sold one coffee, she said.

A few doors down, the doors are permanently shut at Chawla’s Indian Restaurant.

Owner Aman Kaur worked at the restaurant before she bought what she knew was a viable business in early 2024.

Works have been going on for over a year outside Richard O'Hanlon’s Remedy Cafe.

“For the first two or three months everything was good, then they put the construction fences in front of our restaurants,” Kaur said.

“There was no parking, and the customers were avoiding that area. No one likes to come to a construction area and sit in a noisy place.”

When the lease came up for renewal and rent increased to $11,000/month, Kaur said she struggled to pay and the landlord locked the doors early this year.

Hoardings direct pedestrians around works at the intersection of Queen St and Wellesley St, Auckland city.

After borrowing to pay rent arrears, Kaur re-opened, only for the doors to be locked again as she failed to make the rent.

“I decided to leave it. It’s affected my mental health, it was too much for me.

“It was really hard for a big restaurant. I had to pay wages, power, even when there were not customers.”

Further down the block, an eclectic window display of electronic knick-knacks has enticed customers into Nessir Kardhom’s convenience store since 2017.

Since the construction started, trade has plummeted 80%, Kardhom said. He too is borrowing to pay his rent.

“There’s more cones than people,” Remedy Cafe owner Richard O’Hanlon said.

Closer to Queen St, he’s also had Watercare works close by.

Trading dropped by a third when the works started in April 2024, and fell further when winter set in, O’Hanlon said.

The section of road outside his cafe was meant to be finished last month, but has been delayed to next month, he said.

“We’re getting lots of bus stops. I just wonder where all the people are going to come from to get on all the buses”.

The Wellesley Street construction is part of a bus corridor improvement project for City Rail Link, an Auckland Transport spokesperson said.

The project is more complex than first thought, “because of the need to upgrade and future proof infrastructure such as water pipes at the same time as improving the footpaths and bus stops,” they said.

The works will switch to the southern side of Wellesley St in mid-July, and some minor works will continue on the northern side, including localised areas of paving.

“It will be going on all year. It’s like the gift that keeps giving,” O’Hanlon said.

Eligible businesses can access support from Auckland Council.

An annual micro-grant of $3000 will increase to $4000 from July 1, and a free 12-month membership to Retail NZ, Hospitality NZ, or Restaurant Association NZ was added three weeks ago, a council spokesperson said.

Seven Wellesley St West businesses have already taken up the industry body membership offer, they said.