THE DYING WELLINGTON MYTH

Sheer nonsense is being published about the capital dying.

House prices have not risen as fast as other cities, the government has sacked lots of (unnecessary) public servants, cafes and small businesses particularly retail, are failing, Council rates are soaring and so it goes with a seeming daily toll of publicised woes. A seriously dysfunctional Council adds to the negativity.

Now, here are the facts.

Exactly the same things are happening everywhere else to various degrees, all a consequence of the government’s necessary initiatives to deal with the awful economic legacy from its predecessor, the measurably most incompetent government in our history.

My company, as the Capital’s largest prime CBD office-building owner, which buildings contain about 450 office tenancies and circa 60 retailers, is in a very good position to know the truth, when say compared with Auckland.

That’s because we have an almost identical amount of prime CBD office space, although bigger buildings with fewer retailers in Auckland. Trust me; the tenants in Auckland are facing exactly the same problems as in the Capital.

I’ve been around long enough to know such cyclical recessions never last and are followed by booms, which I’m picking for New Zealand in 2026. Why? Because it’s an election year and the government, like all governments, principal interest is in being re-elected and it will ensure a boom by readily available methods.

Wellington’s Post newspaper has wallowed in reporting restaurant closure stories.

Here is a hard fact. The average life of all NZ restaurants over the last half century has been 18 months. In other words, restaurants are very susceptible to fashion, being booked up night after night for say 5 years then abruptly going out of vogue as new cafes become the “in-place” to go.

The conspicuous exception are Chinese family-run restaurants. Their owners are more stoic, if necessary eating their own food and accepting the profitless period, knowing the bad times don’t last, as they never do.

Recently the Post played up the closure of the four shops Bordeaux Bakery company. The owner justifiably complained about the inept Council’s seemingly endless digging up and blocking off the street outside their most secondary location outlet. But if Bordeaux was viable, he’d have just closed that shop and not the other three prime CBD locations. The reality is they’d gone out of fashion.

Indeed up until a couple of years back they had an absolute prime corner location in one of my company’s buildings and couldn’t make it. Another restaurant promptly took their place and is thriving.

Much the same can be said about all other businesses and not just retail.

Interestingly, the Post ran a first rate article by a successful Wellington retailer, a Tristan Thomas.

Tristan wrote, “As a small business owner with 20 years experience in the Wellington CBD I’ve seen my ups and downs”.

He made a particularly keen eyed observation that while running a small business has always been a roller-coaster, since Covid the peaks and troughs have come closer together.

They’ve certainly been crazy years compounded by the alarming foreign news, especially in Europe and the middle east, all of which gloomy reading affects confidence.

Every business is having a hard time at the moment but, if making bugger all, they box on knowing such ups and downs are characteristic of a thriving market economy.

To varying degrees exactly the same scenario is being played out across the nation.

But Wellington dying? Give me a break. Its citizens have the highest income of any New Zealand city by a significant margin, That aside Capital cities don’t die, rather they’re the safest of all cities to invest in because for all the expressed cut back intentions of governments, history shows they keep creating new entities with high paid salaried employees, which of necessity are located in the capital.

As an aside, If I was 40 years younger and had a wish to waste my life and build a huge international commercial property portfolio then in line with my life-long belief in having and eating one’s cake, I know where I’d focus.

That would be in countries in which the capital is also the largest city, such as Copenhagen, Riga, Budapest or Belgrade.

Belgrade epitomes my point. It’s booming. There are literally no empty shops; the restaurants in its mainly pedestrianised city streets are all booming; happiness visibly abounds.