It's being heralded as the "world's smallest gelato store" but it might also take the cake as the nation's smallest shop.

At just 4sq m, this pint-size central Auckland commercial space is about twice the size of the average toilet cubicle. Even the leasing agents admit "it's like a broom closet".

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The former money exchange at 350 Queen St is the new home to Lalele - a handmade organic gelato store renowned for its signature creation: avocado, coconut and French tarragon.

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Director Nathan Gutsell and his wife have just leased the pokey premises for three years and opened up two weeks ago.

Mr Gutsell, 44, said the size - a 1m frontage and 4m deep - posed unique challenges. "You can touch both walls. It's difficult if there's two people in there, you have to dance around each other.

"The staff need to get along."

But there's an upside too.

"The mopping is over pretty quickly - one sweep and you're done."

Their first week of business was "quite good" but quietened down in this week's cold snap and student holidays.

"We're giving it a go. It's just a first step.

"It is difficult to get people to notice us. The shop frontage is so small, we're easy to miss."

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The commercial space owned by Krukziener Properties is being leased for $7500 per sq m, or $30,000 a year.

"The mopping is over pretty quickly - one sweep and you're done." Photo / Chris Loufte

Mr Gutsell will have to sell 4615 single-scoop gelato treats annually just to cover the lease.

The shop comes with no toilet or office but he said he was fortunate to have secured a storage area out back.

The business operated during summer at Mairangi Bay but they decided to give the central city a go, and jumped on the space when it came up after missing out on other sites.

The heavy foot traffic and proximity to Auckland city's student quarter were big selling points, Mr Gutsell said. But he admitted the shop would not suit anyone afraid of small spaces.

"My mum wouldn't go in there."

Bayleys retail leasing specialist Sarah Boles said the Queen St shop was the smallest she had ever leased and colleagues could not recall anything as minute.

"It's like a broom closet - it is tiny. There's no room to swing a cat," she said.