Property editor of the NZ Herald

Vacated stores make for leasing bonanza

Leroy Wolland, Colliers International's Auckland-based retail leasing director, said many different types of businesses were examining leases in ex-Dick Smith stores. Photo / John Stone
Leroy Wolland, Colliers International's Auckland-based retail leasing director, said many different types of businesses were examining leases in ex-Dick Smith stores. Photo / John Stone

It's hard to imagine many local shopping centres without a Dick Smith store but already rivals are eyeing up the areas: out go the TVs, computers and cellphones and in could soon come the pets, manchester, clothes, car products, food and drink.

Such is the swift-changing face of retail in New Zealand that even some Aussie retailers have leaped at Dick Smith's demise.

Get ready for an entirely different category of retail offering from your neighbourhood Dick Smith.

So what might we see?

Pet stores, homeware and manchester businesses such as Bed, Bath & Beyond, fashion stores, businesses selling motor vehicle products and even another electronics retailer are some of the operations which could take the space.

The Australasian chain's exit from 62 stores throughout New Zealand is providing a leasing bonanza for real estate agents, hunting for new uses for the stores.

Leroy Wolland, Colliers International's Auckland-based retail leasing director, said many different types of businesses were examining leases in ex-Dick Smith stores.

"New Zealand's largest manchester specialist Bed Bath & Beyond has taken two of the stores, while another significant brand - who cannot be revealed due to commercial sensitivity - taking a number of outlets, with several more stores around the country under contract or under offer," Wolland said.

Homeware or manchester, electronics, pet stores, an automotive chain, paint or DIY stores, trade retailers, grocery-type operators, some food and beverage operators and fashion were considering ex-Dick Smith stores, Wolland said.

Trevor Brown of Bed Bath & Beyond said it all came down to location: "We have chosen these sites for their excellent exposure, high level of foot traffic and premium location."

Those sites are Onehunga and Tauranga's Bayfair.

Wolland said new businesses were taking minimum lease terms of about six years on the stores, often in prominent locations and ranging from about 400sq m to 1200sq m.
Colliers is working on leasing about 20 of the Dick Smith stores but doesn't have exclusive listings, often working with local agents.

Stores in Auckland, Tauranga, Palmerston North, Levin, Wellington, Christchurch, Queenstown and Dunedin, and more specifically Onehunga, New Lynn, and St Lukes as areas where efforts are being concentrated.

However the fate of one of Auckland's most prominent store locations remains unknown: Precinct Properties' glam premises at the bottom of the hi-tech refurbished Zurich House on Queen Elizabeth Square. The area is a massive construction zone for the City Rail Link starting and Commercial Bay.

Wolland said some Dick Smith stores would go fast.

"Many of the stores occupy prominent locations within shopping centres, high street and suburban strip locations, as well as a large format retail centres.

"Typically the sites are very visible within their environment, with great signage opportunities and exposure, and also boast good, generic floor configurations which are suited to a variety of retail uses including fashion, food and beverage, convenience and homewares," he said.

He is working with colleague Jessica Martin and says the types of businesses taking these spaces are generally quite different to Dick Smith.

"However there have been a couple of electronic retailers who have secured a number of sites, potentially capitalising on the goodwill generated from the location created by Dick Smith's stores. There are also a couple of new entrants to the New Zealand retail market from Australia who have jumped on a number of these sites," he said.

Dick Smith's closure had accelerated their arrival.

Many Dick Smith stores in malls are in good locations and should be easily leased, maybe to another national brand. But it not all good news for all landlords.

"Some ex-Dick Smiths stores in regional New Zealand and those towns with smaller catchment sizes might struggle to attract tenant interest. This small catchment size could be seen as a barrier to entry for other national branded tenants in in towns such as Alexandra, Masterton, Kerikeri where Dick Smith operated from one of the best spots in town."

- NZ Herald

Get the news delivered straight to your inbox

Receive the day’s news, sport and entertainment in our daily email newsletter

SIGN UP NOW

© Copyright 2016, NZME. Publishing Limited

Assembled by: (static) on production bpcf02 at 28 Sep 2016 18:46:16 Processing Time: 555ms