Jingle Tills: How is the lead up to Christmas going at Commercial Bay?

Monday, 2 December 2024

Commercial Bay was opened by Prime Minister Jacinda Ardern in 2020 to much fanfare but suffered through the pandemic. Now, four years on, the shopping centre inspired by Melbourne’s shopping lanes appears to be thriving - and doing what it set out to do.

In the first of a five-part series, senior business reporter Aimee Shaw takes a look at how retail is tracking at shopping hot spots across Auckland in a year in which consumer spending has hit the skids.

The food court is heaving, and the amount of people trawling through Commercial Bay has noticeably swelled.

The inner city shopping centre located in downtown Auckland, just a stone’s throw away from Quay Street and the waterfront, is feeling festive.

Across the forecourt from the 18m-tall Christmas tree, festive decorations are out illuminating the ground floor of the Melbourne-inspired shopping lanes, and retailers have their Christmas deals and discounts displayed loud and proud in the windows.

About 200,000 people visit Precinct Properties’ Commercial Bay each week, and that number is expected to swell upwards of 300,000 per week leading up to Christmas.

Scott Pritchard, chief executive of Precinct Properties, says those predictions are based on the upcoming line up of Christmas events, including the Santa Parade, which traditionally brings with it huge crowds and visitors to Auckland city centre.

Events are a big draw card and determining factor when it comes to spending levels and foot traffic volumes through Commercial Bay and the wider Auckland city centre.

Last month Commercial Bay had its biggest week of the year with thanks to Coldplay and Pearl Jam concerts, bringing through 320,000 people.

Pritchard is tight-lipped on sharing sales data, but says that resulted in a lucrative amount of retail sales.

“For every person that walks through the centre, there's a really high correlation with sales,” he says, adding that sales looked likely to continue to get stronger in the weeks ahead.

“The criticality of events, and the importance of them, has never been better represented than what we've seen recently.”

The head of the almost $2 billion property company says half of Commercial Bay’s customer base is tourists, 30% international and 20% domestic visitors, the rest being the catchment of city centre workers.

Between now and April next year there will be an influx of tourists ‒ and with those coming from North America, with the dollar down, that would make Commercial Bay a compelling offer for shopping, says Pritchard.

“That's going to underpin foot traffic and sales for the next six months. Domestic tourism remains steady, and as we see better weather and more events, and a more festive environment, I think the city is going to do really well in the next few months.

Black Friday kicks off the spending season at Smith and Caughey's which expects about 100,000 visitors through its doors in the lead-up to Christmas.

“We're still in a tough economy, but what we’ve seen in recent weeks is encouraging.”

While he is hopeful for a good few months of festive trade, he holds some concerns over what could be a tough period of trade following summer if more events are not prioritised.

Trading expectations

Shoppers who The Post spoke to say they had been saving through the year to be able to afford to splash out on Christmas gifts, and retailers were generally upbeat albeit slightly cautious about spending expectations for the silly season.

Pip Larner, owner of shoe brand Scarpa, which operates a store on the ground floor of Commercial Bay, says foot traffic and transactions were trending up but it was hard to say whether recent changes in consumer behaviour would result in a marked increase in trading this Christmas.

“Things are picking up thanks to some of the fun events on. It seems people are wanting to get out and live in the now and hopefully spend money.”

Shopper volumes through the store fluctuated, but Larner says with the weather warming up consumers were in a better mood and generally more inclined to spend money.

“We’re hoping it will be better than it has been. I don’t know if it will be amazing, but it’s got to be better than it has been.”

That sentiment was echoed by Kiran Ahmed, store manager of clothing retailer Scotch & Soda.

“I’m hopeful there will be a surge in foot traffic and spending but it’s really hard to predict. It changes daily and we’re just taking it day-by-day.”

Over 1000 people visited Scotch & Soda on the Saturday of the week of the Coldplay show at Eden Park last month ‒ a surge compared with the usual 200-300 people through on a weekend, says Ahmed.

Auckland CBD has its giant baubles and 18-metre-tall Christmas tree up.

“A lot of money we make is from cruise ships. But we’ve also noticed a dip in spending from them as well, compared to last year, so it’s hard to predict what Christmas trading will bring.”

The case for $1.23 million Christmas tree

Precinct Properties is footing the majority of the bill for the giant 18m-tall Christmas tree decorated with pōhutukawa flowers, giant baubles and more than 10,000 LED lights in Te Komititanga Square, Britomart.

Precinct Properties chief executive Scott Pritchard is expecting a busy and prosperous period of Christmas trade.

Thought up by the company and funded mainly by Precinct Properties and the Heart of the City, Pritchard says the tree, Te Manaaki ‒ officially lit at a concert featuring Anika Moa and Auckland’s Youth Choir ‒ would be another reason for shoppers to visit the city centre and ultimately benefit local retailers.

“For every person that comes through there is a direct benefit in terms of sales and that's why we're investing in things like the Christmas tree because we want more people back in the city. We want more people walking through Commercial Bay because we know it helps our retailers.”

Overall trade and visitor numbers to Commercial Bay have been “a bit of a roller coaster” this year, says Pritchard.

While that was now easing following the recent openings of the InterContinental Auckland hotel, scenic rooftop bar Queens and Chinese yum cha restaurant CānTīng by Nic Watt, Pritchard says the centre was beginning to see “really good momentum”.

“Through winter we had a period of low foot traffic. At the start of the year we had issues like safety and [negative] perceptions that were surrounding the city centre. But we've seen a series of good outcomes in the last few months; the response from central government around more police has been great, and we're seeing more and more people become aware that the city centre is actually a great place to be.

“In the last few weeks, we've seen Coldplay, Pearl Jam, and the start of the cruise ship season. Every couple of days, we're getting a cruise ship arrive, and that's unloading thousands of people into the city centre, which we’re seeing benefits from.”