Huge Westgate Palmers building being torn down after only 6 years

An Auckland store sprawling over half a hectare is being demolished only six years after it was developed.

Mark Gunton, the founder and owner of NZ Retail Property Group, confirmed today that the Palmers Garden Centre at Westgate would be shuttered.

But it’s not all bad news for the landlord or for shoppers.

Gunton said the property was being demolished to expand the Mitre 10 Mega by 16,000sq m – equivalent to more than two rugby fields.

All that is rising near the under-construction $100m Costco, with the world’s second-largest retailer after Walmart picking Westgate to make its 2022 New Zealand debut.

Palmers said in June it was shutting its Westgate big box which it only opened just before Christmas, 2014. The purpose-built shop is just six years old.

A Palmers spokeswoman said in the winter the retailer had planned to shut the store and relocate to a smaller location adjacent to the site before the mandatory lockdown, but the forced closure of stores and lost revenue had made that unfeasible.

The decision to close Palmers Westgate was “made in isolation” and no further store closures were planned, the spokeswoman said.

Gunton said today his business developed the 4000sq m Palmers of almost half a hectare, a property he said was valued at around $5m to $6m. However, the franchisee had “abandoned” the store and the lease and that was subject to court action, he said.

Now, the Mitre 10 Mega expansion would allow a much larger trade area of that national operation. It was not possible to use the existing Palmers’ buildings for Mitre 10, he said because the Palmers had been purpose-built and the existing building was unsuitable for Mitre 10’s operations.

“We’re just moving to a higher and better use,” he said, picking up on a land valuation term which valuers’ use to maximise a site’s potential.

“Property is like Monopoly,” he said referring to owning premium greenfields sites where major retailers wanted to move to.

“Mitre 10 has traded phenomenally here. In fact, everyone has traded that well. A gym here has doubled in size. We’re about to sign up new international tenants for Westgate which I can’t talk about right now. The Bunnings here is the biggest in Australasia.

“This has been a really interesting year. Covid’s done retail a really big favour. It’s proved that internet selling didn’t work.People have told me – including bank managers – that their goods never got delivered.”

New Zealand was a nation of spenders, he said, with women in many households controlling those patterns.

“People get paid fortnightly and once they have that money, they want instant gratification and they want to spend it. Many don’t have the patience to buy online and wait for it to be delivered.”

Auckland Council says that in the next 30 years, the population of the future urban areas of Red Hills and Whenuapai are anticipated to grow from 4000 to over 40,000. This growth will be significant.

“The lack of employment in the northwest also resulted in the identification of over 300 hectares of land in and around Westgate, Whenuapai and Hobsonville Road for business activities, particularly light industry,” the council says.

Campbell Barbour of NZRPG says Westgate is the first new town centre to be built in Auckland since last century’s creation of Albany and Manukau.

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