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Pioneering South Otago tourism business goes up for sale

Pioneering South Otago tourism business goes up for sale

One of the first tourism ventures in South Otago developed to service the international visitor market has been placed on the market for sale – almost 40 years after it was first opened by one of the region’s most colourful characters.

Peggydale tearooms, function centre, and souvenir/giftware shop has been operating just south of South Otago’s main centre Balclutha since 1975 – growing in parallel with the increasing amount of tourist traffic travelling along State Highway One.

The business was founded by paraplegic entrepreneur Bill Jones and his wife Peggy, in what has become South Otago folk-lore about one man’s recovery from adversity. Jones was a coal miner at Kaitangata in the 1950s when a ceiling beam collapsed on him and left him paralysed from the waist down.

Doctor’s diagnosed Bill to have a two-year life span. Yet his determined spirit persevered and Bill survived. During a two-year recovery in Dunedin Hospital, Bill shared a ward with a saddlemaker who taught him the intricacies of leatherwork.

Bill was eventually awarded a compensation payout, which he used to buy a farm at Kaitangata. Finding that cattle herding across the paddocks was somewhat difficult in a wheelchair, Bill turned his attention to his burgeoning leathercraft skills – making children’s schoolbags, toys, and belts from a small lean-to tacked onto the end of the farm’s implement shed.

As the leathergoods business boomed, Bill found the trade was more lucrative than farming.

He and wife Peggy subsequently sold the farm and opened what was Peggydale Leathercraft - selling the by-now expanded range of hand-made purses, wallets, slippers, and handbags.

That was the genesis of what is now Peggydale - sitting some three kilometres south of Balclutha. Over the ensuing years, four expansions of the original building have been undertaken, along with a café being added, which duly evolved into a full restaurant, while the range of leathergoods sold out of what was a small display space, has turned into a substantial Kiwi clothing store as well as a vast New Zealand souvenir outlet.

In a 1978 interview, Bill Jones quipped: “I have 100,000 tourists a year coming here to see and buy leatherwork but we’re not a designated tourist area.” At that stage, Peggydale’s visitor numbers were comparable to the likes of the now enormous tourist destinations of Wanaka and Arrowtown.

Following Bill Jones’ death in 1997, the business was continued by son Mervyn and his wife Alison. However, now in their 40th year of operation, the couple is looking forward to semi-retirement.

With none of their children expressing any interest in continuing the family dynasty, Mervyn and Alison are resigned to the fact that the sale will see an end to the family’s long association with the area. The Peggydale land, buildings and business are being marketed for sale by negotiation through Bayleys Dunedin.

“After a lifetime at Peggydale, yes, I’ll be sad to go, but I guess that’s life – and sometimes you have to say enough is enough, it’s time to let someone with a new drive and enthusiasm take the business into a new space,” said Mervyn, who has been with the venture since its inception by his father.

“We looked at selling Peggydale a few years ago, but decided to keep going and enjoy the huge benefits which came with the Rugby World Cup and the scores of Argentinian, British and domestic tourists who travelled south.

“However, as the euphoria of that has dissipated, we’ve decided to once again look at selling up so we can spend more time with family and friends, as well as pursuing other interests that have been put on hold for too long”

Bayleys Dunedin salesperson Miles Rapley said that while Peggydale’s ’bread and butter’ business would continue to come from the bus-loads of tourists stopping for refreshments and souvenirs seven days a week, the venue’s future potential lay in morphing into a function venue servicing a client-base from the surrounding rural townships of Milton, Clinton, Gore, Owaka and Balclutha.

Peggydale sits on a 9.93 hectare block - consisting of the main hospitality and retail buildings, with a nearby four-bedroom owner/operators’ home. The 340 square metre café has seating for 100 guests and is serviced by a fully-equipped kitchen with commercial-grade cookers, hobs, chillers and freezers. The foodservice activity employs nine staff all on rostered positions.

The venue’s neighbouring souvenir and gift shop occupies 587 square metres of space laid out in a retail format. The revenue stream employs five staff also all on rostered positions.

Mr Rapley said the owners’ luxury 274 square metre four-bedroom residence had been reconfigured in 2011 to potentially operate as a B & B – with two of the bedrooms offering en-suite facilities, and all bedrooms containing wall-mounted TVs.

“The provision of commercial accommodation is certainly one potential new revenue stream, as is the development of the existing food and beverage infrastructure to take on more functions such as weddings, anniversaries and birthdays,” Mr Rapley said.

“With the wide expanse of bush-clad gardens immediately adjacent to Peggydale’s dining area, it would be relatively easy to initiate minor landscaping works such as the addition of water features, rockeries, or pergolas to create the perfect backdrop for wedding photography, or to host outdoor events.”

Mr Rapley said the other alternative for potential purchasers could be the development of a non-competing shared use complex – bringing the likes of a plant nursery on board – which would broaden Peggydale’s guest appeal to a wider demographic.


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