The dead heart of Auckland - rail progress is killing business

Antony Ariano, owner of Da Vinci's Italian Restaurant. Photos / RNZ

The country's largest infrastructure project, the $4 billion Auckland City Rail Link, is touted as long awaited solution to the daily commuting nightmare for thousands of people.

But it is far from finished and for dozens of small businesses it has turned into a desperate battle for survival. They say they are being crushed by the construction chaos in the city centre and no one is listening.

They are also warning that other businesses around the city and the rest of the country will face the same disruption as billions of dollars are poured into projects designed to pull the country out of the Covid-19 recession.

Today the Detail walks up Albert Street to meet some of the business operators struggling to stay open three years after CRL work started, with roads and footpaths blocked or closed, filled with orange cones and barricades and the incessant construction noise.

Sunny Kaushal, who owns the Shakespeare Tavern on Albert St, is leading the fight for compensation. He says businesses have been neglected and City Rail Link has treated them poorly.

"In the last three years it has been a virtual lockdown for the street as we have seen for the Covid lockdown. And now these businesses have been hit with the double whammy. Three years of City Rail Link and then Covid struck."

Many businesses, including the landmark restaurants Mai Thai and Grasshopper have shut and many are on the brink. Kaushal says business owners are suffering from ill health and taking anti-depressants.

"We have high rent, the operational expenses are very high, we have to support our staff, we have to pay our rates and of course so many invoices to keep running, that needs cashflow, without cashflow businesses are on the verge of closing."

Kaushal says the Shakespeare has notched up nearly $2 million in lost earnings in the last three years.

"Let me tell you last week, for example, there was a Thursday and Wednesday there was no one for lunch."

He's thankful to loyal customers and surrounding businesses that send staff to support Albert St including BNZ which has provided vouchers, but it is not enough.

The three pillars of business in the area are office workers, tourists and foreign students. Most people have not returned to offices in the city and there are no tourists or foreign students.

"This is a challenge to the mayor of Auckland to first of all get people back into Auckland. The city is looking like a ghost town," says Kaushal.

"The Government and the agencies, they need to come forward and support these businesses because they are ultimately paying for our rail."

CRL launched a hardship fund for businesses last October but businesses the Detail spoke to on Albert Street say it is inadequate. Kaushal has vowed to keep fighting for compensation from CRL.

He bought the Shakespeare four years ago when the business was profitable. He knew CRL works were planned for Albert St but "we had no idea it was going to be of that scale".

"What City Rail Link was showing on paper was very nice drawings, very colourful ones, saying this is just cut and cover, cut and cover. This is more than cut and cover, it has virtually ruined so many businesses, it has destroyed hundreds of workers' lives and their livelihood."

There may be signage telling the public to love Albert Street in Auckland but there's more construction than shoppers.

The manager of a Roma Blooms Florist, Shobhana Ranchhodji says CRL should give "free money" to customers to spend at affected businesses to help them survive.

"If they can't give us the money give it to people to use in our shop. They (CRL) can give money to the hoardings, for a designer to come in and paint all of that, they can do so much for every other business but the businesses on the actual street have got no help."

City Rail Link introduced its Business Hardship Programme last Christmas. It is a rent-based scheme and applies only to those businesses in Albert St impacted when work on CRL's C2 contract there fell behind schedule.

In a statement, CRL says it acknowledges that constructing a project of this size in the middle of a city is challenging and the Business Hardship Programme was one of a series of measures it introduced as it worked with businesses over several years to offset the impact of construction.

It has paid out about $620,000 from existing funding for the project. It says it applied an impact assessment rating against the rent. Due to the Covid lockdown, independent valuers were unable to carry out inspections, it says. CRL responded by stepping in to make payments on an interim basis to assist those businesses that did qualify for support.

"Independent valuers peer reviewed CRL Ltd's assessment methodology and confirmed that our approach was "well-reasoned and appropriate when benchmarked against a fair market rental".

It says there will be no further support.

"The Business Hardship Programme applied only to those businesses impacted in the lower end of Albert St area by our C2 contract. Our C2 contract is now finished."