In September 2010 and February 2011, Christchurch was struck by two powerful earthquakes, the latter which significantly destroyed parts the city, in particular the city centre. In the months following the 2011 quake the New Zealand Government and the Christchurch City Council (CCC) formed the Canterbury Earthquake Recovery Authority (CERA) – which is set to dissolve on 18 April. Within the first few months CERA implemented an ambitious plan to rebuild the city centre through the Christchurch Central Recovery Plan (CCRP). MacroPlan provided retail expertise to CERA in the early stages of planning for the rebuild, providing advice around the potential scale, mix and configuration of the retail core around Cashel Street. The rebuild of the retail core was one of the ‘anchor projects’, of which there were 17, that were intended to stimulate growth and catalyse other investment and development across the city centre, and more broadly across metropolitan Christchurch.
The past five years… Delays in land acquisition, demolition delays and employment/resource availability has inhibited the redevelopment of the city centre and the development of most of the anchor projects. In the interim, commercial, residential and retail development activity continued (albeit somewhat subdued), just beyond the city centre and in the suburbs. Interesting retail concepts emerged (e.g. Smash Palace – a bar made out of disused buses), new housing was developed where the land was stable and the office/business park around the Christchurch Airport evolved considerably.
With the virtual complete destruction of the retail core in the city centre, suburban shopping centres were beneficiaries of transferred demand that would previously have otherwise been captured by the offer within the city centre. While some centres required significant structural works, many of these centres experienced above average sales volumes in the years following the earthquake and there was also some new stock provided to the market.
That said, the green shoots of recovery were seen in the city centre not long after the earthquakes. The ‘temporary’ Re:start container mall has become an iconic tourist attraction and has inspired many new contemporary retail developments across the world. The New Regent Street precinct contains an eclectic mix of retailers, small businesses with a unique art deco charm; a boutique cinema opened at The Colombo shopping mall; and new bars opened up out of derelict buildings and industrial premises in the city centre and its periphery.
The next five years… The redevelopment of the retail core (around Cashel Street) - which was considered as an important catalyst for the broader rebuild of the city centre - is now well and truly underway, with several major developments at various stages of development. This particular Some of the exciting new retail projects include The Terrace – a new food and beverage and commercial development near the Avon River which is due to open during 2016 – with additional stages to follow; and the $140 million The Crossing project - an exciting 14,000 sq.m redevelopment that will be connected to the Ballantynes department store, which is expected to accommodate 60 new businesses including international retailers (including the likes of Top Shop) is due for completion towards the end of 2016/early 2017.
Several hotel projects have been completed in the city centre and there are more on the horizon (e.g. Crown Plaza due to open 2017), yet hotel rooms are still in short supply. About 4,000 hotel rooms were lost during the earthquakes and with a booming tourism market and business related market, there has been, and continues to be, strong demand for new temporary accommodation facilities in the city centre.
The Bus Interchange was the first CERA anchor project in the city centre (completed in late 2015), and several other anchor projects are expected to be completed in the next few years or more. The 40,000 sq.m Justice and Emergency Services precinct is one of the larger projects set to be completed in the near future, which is due for completion during 2017, supporting in excess of 2,000 workers.
There are billions of dollars’ worth of projects currently underway or planned within the city centre and its frame over the next few years. More than 200,000 sq.m of new office and retail space is due for completion in the next few years, supporting an inner-city worker population of more than 15,000 workers, with the CCRP outlining a target of more than 60,000 jobs over the long term. More than 20,000 new residents are planned to be accommodated in the city centre by 2025, of which around 2,000 – 2,500 could be accommodated in the next few years in the $800 million Fletcher Residential development in the East and North Frame Residential Precinct.
In summary, while much has been achieved over the past five years, the next five years will bear the fruits of the hard work to date with many of the anchor projects expected to be completed or significantly advanced; key retail developments will be open; and increased residential, hotel and office floorspace will support day and night-time populations in the city centre.
MacroPlan has developed a detailed profile of residential and retail trends post-earthquake and continues to work on a number of significant retail projects across metropolitan Christchurch. MacroPlan also works extensively across the rest of New Zealand advising both New Zealand and Australian clients on retail assets/developments.
Contact James Turnbull, National Head of Retail today to discuss your retail property research requirements in both New Zealand and Australia.