Death of after-work drinks linked to bevy of bars on market
Saturday, 20 June 2026
Not too long ago hospitality operators would be fighting to get into a fully kitted out bar along Wellington’s entertainment strip.
Not so these days, where even the biggest players are struggling to find tenants.
Star Group, one of New Zealand’s largest hospitality operators, has three sites in the capital that are sitting vacant ‒ the landmark Henry Pollen building on Willis St, which last housed POP, the Garden Hotel in Courtenay Place and Rizzo’s pizzeria and garden bar in Lower Hutt.
POP closed more than a year ago, and has been untenanted since. The site, despite its high profile mid-city location has had a chequered hospitality past with at least one previous tenant liquidated by IRD.
Before POP it was Henry Pollen’s (The Quackery) and before that the General Practitioner, which was owned by hospitality veteran Danny McGrath, and Bouquet Garni, which was placed in liquidation in 2006, owing $15,362.
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At the Garden Hotel, a notice appears on the door stating the lease has been cancelled due to the lessee defaulting on their obligations.
Sam Egerton, the CEO of Star Group, confirmed it was seeking operators for a small number of Wellington venues that were not trading.
“This is about finding the right operators to bring them back to life.”
At the same time the group was continuing to invest in its portfolio, he said.
“Recently, we opened Goldies Bar & Yard, a modern honky tonk bar experience in Auckland, and the next few weeks will see an exciting brand refresh of Master Kong in Wellington. Additionally, we are scoping new investment in the Wellington region.”
Egerton said reviewing its venues ensured Star, which is backed by brewery behemoths DB and Heineken, had the right mix of venues, brands and experiences.
A changing culture
The pivot doesn’t surprise industry insiders. They say the sector is undergoing a major shift, largely due to “over-cooked” rents deterring new business, and the collapse of the post-work drinking culture.
Venues caught with expensive, long-term leases negotiated in a pre-Covid boom era now can't shake them.
“In the old days we would have all been falling over each other trying to get into somewhere like the Garden Hotel,” Epic Hospitality’s Greig Wilsonsays, describing a time when premium leases sparked fierce bidding wars.
“I remember trying to bid on the Siglo … we were in a bidding war with Nick Mills to get that lease because we thought it was a fantastic site. Now it’s empty and dormant, no-one wants it because of the lease.”
Siglo, like the Garden Hotel bar, is in a prime spot on Courtenay Place. But a prime location now also means a punishing rent bill. Wilson believes the lease on the Garden Hotel is “north of $300,000” - or around $7000 a week.
“So you've got to sell $20,000 worth of booze just to be able to cover the rental cost. And that's before you start paying the power or the staff.”
Conversely, bigger players with multiple venues could weather a few storms because they could prop up weaker sites by moving cash around. On the other hand single-site operators lacked the financial flexibility to survive similar downturns.
Wilson said there had also been a fundamental change in how Wellingtonians socialised, which had had a negative effect on bars outside of the recognised entertainment hub.
The later, night-time “party aspect” was thriving. “It's student city really - they’ve come out of recession, they don't have houses and mortgages … so they're coming out and having fun.”
However, the after-work crowd had dried up. “People upload a six-pack on the way home - they're not coming out to drink after work.”
Rather than just hoping the punters showed up, some venues were redesigning their entire offering, he said.
“Uncertain times” was how Trinity Group's Jeremy Smith described the state of play over the last five years.
“The hospitality sector relies on discretionary spend - in uncertain times people don’t travel as much or go out as much. This is true for both the business sector and the average punter.
“The result is that overall hotels and the hospitality sector have struggled. Work from home is no longer a trend. It’s the new way of life.”
The caution flowed through to investors as well, he said, with fewer people wanting to take on businesses that faced constant challenges.
The result in Wellington was “a long list of hospitality businesses listed that are struggling to sell and a long list of vacant tenancies looking for tenants”.
Little incentive
JLL Real Estate’s director of retail leasing, Jim Wana, said where demand was soft, as was the case in Wellington at the moment, owners had little incentive to move away from a big, reliable tenant.
That was reflected in the number of prominent hospitality sites - “opportunities” - that had been sitting empty for some time. That they hadn’t been snapped up highlighted how tough the leasing market had become.
For anyone taking on or exiting a site, the numbers were unforgiving. “Coming into this market, you’ve got to have your wits about you. It’s not just about a concept, it’s about execution and it’s about the balance sheet.”
That’s echoed in figures released in May, with a report by Centrix Credit Bureau noting 414 hospitality liquidations nationwide over the last year - second only in number to the construction sector, which recorded 780.
Year-on-year hospitality failures rose the fastest; up 49%, while construction liquidations were up 7% over the same period.
Wellington recorded 36 hospitality liquidations to May 2026, compared with 31 over the same period last year.
Centrix chief operating officer Monika Lacey said the figures highlighted the continued challenges the sector was facing, particularly amid cost pressures and softer discretionary spending.
Both hospitality and retail had been hit hard during Covid with the shift to working from home reducing foot traffic, leading to fewer people in the city. While conditions were stabilising for most other businesses, there was persistent financial pressure on hospitality.
According to the report, credit indicators for hospitality showed liquidations made up just 1.3% of the sector, and 0.5% of the retail sector.
“Although the liquidations are high, as a percentage for those sectors, I think overall as an industry component, it's quite low,” Lacey said.
Recent bar closures have included Plonk, Poquito, Crumpet, Whistling Sisters, Avida, Leuven, Concrete Bar and Fortune Favours.
The iconic Havana Bar remains unsold, while at least two other inner city bars are also on the market.
One is a wine bar, with an off-licence. An advertisement describes it as “a cornerstone of Wellington's wine and dining scene” with an “elevated” food offering and a “show stopper” wine list that “began with four investors with a shared vision.“ It has an “extensive, curated wine program … nearly 1000 wines including rare allocations and sought-after labels from classic wine regions”.
The $595,000 asking price includes stock.
Noticeable churn
Hospitality New Zealand’s Kristy Phillips pointed out that the number of accommodation and food service businesses registered in Wellington remained unchanged from this time last year, and was up 16% since May 2019.
“Because of the visible footprint of hospitality businesses, any churn in venues is much more noticeable. The public follow these trends and like trying out the new offerings even as old favourites may be moving on.”
Like Wilson, Phillips noted that food and beverage trends were changing: “We are seeing more emphasis on smaller venues focused on experiential dining rather than large-format establishments, particularly in main centres.
“Hospitality has always adapted and shifted as guest preferences move and international trends influence New Zealand.”
While Wilson sees a trend toward fewer smaller creative owner-operators and more group-dominated venues - “and that’s a shame” - he’s also predicting some bright spots on the 2027 horizon.
That’s despite this week’s council decision to scrap plans to spend big on the area as part of its Golden Mile project and instead look at a cheaper option, which Wilson hoped would encourage “desperately-needed” hospitality investment.
“We’re still looking forward to next year, because we’ve got Readings opening, and then there's also the big backpackers that’s about to reopen off Courtenay Place on Cambridge Terrace. It holds 300 people. It's been closed for years … so those things are all big, massive game changers.
“If any business that's losing money can just hold on till next year then I think there's better times coming.”