Hawke’s Bay retail occupancy rates are now better than they were pre-COVID, according to Turley & Co’s latest Retail Property Focus Report.

The latest report, for the third quarter of 2021, shows Hawke’s Bay retail occupancy is 94 per cent, up 1 point on pre-pandemic occupancy of 93 per cent.

The current 94 per cent occupancy level is the highest in six years, since bottoming out at 90 per cent in 2015.

The strong retail-occupancy level is backed by consumer spending.

“Statistics New Zealand information indicates retail spending for Hawke’s Bay Q1-20 was $787m pre-COVID and most recently Q2-21 $888m reflecting an increase of 12.8%,” the report says.

The second-quarter retail spending this year is up 36 per cent compared with the same period last year - from $653 million to $888 million, the report says.

“Hawke’s Bay physical stores retail occupancy 2019-2021 is displaying an improvement trend and very good resilience to COVID effects and online retail headwinds. Hospitality occupancy continues to increase.”

The occupancy rate is “considerably better than some pre-pandemic effects commentary suggested was likely”.

“Hawke’s Bay mainstreets’ retail occupancy has overall improved notwithstanding COVID and online retail challenges, with strong domestic tourism assisting.”

The occupancy rates have recovered despite the overall increase in retail outlets. Since July 2015, there are now 10 more retail outlets on the selected precincts sampled for Turley & Co’s Retail Property Focus Report.

Shopping precincts in Hastings, Havelock North, Napier and Taradale are sampled.

In Hastings Central retail vacancies decreased by one retail unit from March 2020 to September 2021.

“The category mix has changed over six years 2015-21, migrating away from fashion retail that is down 5 percentage points to more hospitality up 2 points – a Hawke’s Bay-wide trend,” the report says.

“Heretaunga Street East and nearby is now a well-established dining and entertainment district.”

The report says Hastings District Council actively supports increasing outdoor dining, including street-dining buildouts and clustering similar business licences “achieving central Hastings increasing vibrancy”.

Despite the number of Havelock North retail outlets increasing by 10 since 2015, it recorded a 97 per cent occupancy rate in the latest report.

In the Napier Central precinct, Emerson St vacancies increased by two retail outlets from March 2020. In the previous six years the number of outlets has increased by three, compared with Hastings Central’s decrease of two retail outlets for the same period.

Taradale retail vacancies fell from four in March this year to three in September.

“Hawke’s Bay physical stores primary retail occupancy for 2019-2021 is adaptive, resilient and robust,” the report says.

Commenting on the report, Turley & Co property strategist and valuer Pat Turley says the occupancy levels are a very good news story.

“These figures are remarkable and reflect strong confidence in all sectors of the Hawke’s Bay property market, thanks to a strong Hawke’s Bay economy which has shaken off COVID.”

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