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Bayfair Shopping Centre

Bayfair sits at the heart of Mount Maunganui

Tauranga is New Zealand’s fastest growing city. At the heart of its prime residential strip sits the AMP Capital managed Bayfair Shopping Centre, the Number 1 performing centre in the country in terms of Specialty retail turnover. Bayfair’s redevelopment, currently nearing completion, will see it increase its GLA by a third, thereby cementing its position as Tauranga’s major centre.

Something of an enigma presents itself when you visit AMP Capital managed Bayfair Shopping Centre in New Zealand for the first time – the airport is quite close – a mere 10-minute drive. Bayfair sits at the heart of Mount Maunganui, a beach town with hot saltwater pools, an extinct namesake volcano with winding walking paths. Offshore is the active volcano, White Island. The town is part of the city of Tauranga, located about two-and-a-half hours’ drive south-east of Auckland, sitting on the western side of the Bay of Plenty.

Bayfair Shopping Centre sits in the middle of a projecting strip of land some 16 kilometres long, bordering the ocean and forming the bay and the port of Tauranga. The actual Mount Maunganui lies at the northern tip and is connected by white sand beaches to Tauranga’s largest suburb, Papamoa at the southern end. It’s a stunning, sub-tropical landscape; the residents along the whole stretch are within easy reach of the ocean. It’s a resort feel; the ambience one of relaxation, of balmy nights, alfresco dining and beach-side pursuits.

The ‘enigma’ is that as one leaves the airport, the roads seem ‘overly busy’. Massive trucks, container road trains, industrial and commercial buildings, all seem too much, too intense, too copious to support the resident and tourist population. Delve a little deeper and the puzzle is solved. Tauranga is a split city. Residential wise, most people live on the long, beach side strip separated by water (the bay and the port) from the CBD and the main industrial and commercial hub. Absorb what the town of Mount Maunganui has to offer and you could be oblivious to the commercial significance of Tauranga!

Tauranga is one of New Zealand’s main centres for business, international trade, culture, fashion and horticultural science. The Port of Tauranga is New Zealand’s largest port in terms of gross export tonnage and efficiency.

Tauranga is New Zealand’s fastest growing city with a 14% increase in population between the censuses taken in 2001 to 2006. Although slightly lower, the increase was a massive 11% from 2006 to 2013.

This phenomenal growth has resulted in Tauranga becoming New Zealand’s fifth largest city and, in the five years from 2013 to today, the continued growth has seen it become the top performing city in the country across all key measures of economic activity.

The largest and most important shopping centre in the city of Tauranga is Bayfair Shopping Centre.

Bayfair is the only major regional shopping centre in the Bay of Plenty region. It has the highest specialty sales per square metre in New Zealand and is the undisputed Number 1 in the country with specialty turnover a massive 45% above the benchmark centres. Quite simply, Bayfair Shopping Centre is a powerhouse in terms of specialty retail sales, currently achieving a massive $13,660 per square metre. But as it stands, Bayfair Shopping Centre is too small: too limited in its offer and too restricted in its capacity, to meet the demands of its trade area.

But all that is about to change!

AMP Capital managed Bayfair is a relatively small centre at present, some 32,000m2, anchored by a Kmart, Farmers department store and Countdown supermarket; there’s a large JB Hi-Fi and the specialty component is strong. Iconic retailers such as Rodd & Gunn, Cotton On, Just Jeans and Jay Jays are there, along with Overland, Michael Hill Jewellers, Adairs, OPSM, Specsavers, Kathmandu and Smiggle. The food arena features Dominos, McDonald’s, Subway and The Sushi Shop, supported by a powerful mix of local operators. The service sector offers all the major banks, a Flight Centre et al. And why wouldn’t they be there? At more than $13,500 a square metre, those who aren’t are champing at the bit to get a spot!

Bayfair Shopping Centre is about to expand, increasing its area by a third to more than 41,000m2. But before we look at the expansion, it’s important to understand the trade area and the spectacular growth of this region; any story about Bayfair is a story about the city and the region itself.

This is a story of phenomenal growth; it’s a city that has doubled its population in less than 20 years. Bayfair is the only major shopping centre and it sits at the absolute epicentre of the major residential areas of the city.

Drive south from Auckland for 105 kilometres (less than an hour and a half) and you reach Hamilton; drive south-east for two-and-a-half hours and you come to Tauranga. Join the three cities together on a map and a triangle is formed at the northern tip of New Zealand’s north island. It’s known as the ‘Golden Triangle’ containing some 2.46 million people or half the population of the country. The GDP within this triangle accounts for $117 billion or more than half the New Zealand economy. More than 50% of all jobs filled in New Zealand are within this triangle and its fastest growing region is the city of Tauranga. Outside the Golden Triangle, less than an hour’s drive south (63km) is the city of Rotorua with a population of some 70,000.

Tauranga’s mild, sub-tropical climate boasts between 2,200 and 2,500 hours of sunshine a year, making it one of the country’s sunniest cities; the purity of its atmosphere, the surrounding kiwi fruit country and, according to Travellers’ Choice, the ‘Best Beach in New Zealand’ makes it a magnet for Auckland residents, others in the Golden Triangle and beyond.

Tourism, both domestic and international, contributes greatly to Tauranga’s retail sector. In 2017, tourism spending accounted for $939 million. Tauranga is the largest cruise tour port in New Zealand; more than 80 cruise ships visit each season, bringing more than 230,000 people to the city.

Bayfair’s Main Trade Area population is forecast at 153,490 this year; the Total Trade Area accounts for some 284,670. The Main Trade Area boasts an affluent demographic with Primary Trade Area residents average per capita income sitting 11% above the Bay of Plenty average.

Access to the centre is superb. The new Eastern Link, which provides direct access to the centre from all suburbs to the east (including Papamoa – see map), has just been completed at a cost of some $455 million; and there are further upgrades to the roads servicing the centre including $120 million Baypark to Bayfair flyover, which will assist access for the 37,300 vehicle movements, passing the centre each day. Tauranga’s largest Stadium and Events Facility, ASB Baypark with a capacity in excess of 21,000, has a direct link to the centre and the on-site Arataki Transport Hub with more than 190 buses per day is presently being re-located and upgraded to service the new centre.

So that’s the scenario of Tauranga, the fastest growing region in New Zealand with its population comprised of residents enjoying one of the best climates in the whole of the antipodes, week-enders from Auckland just a couple of hours away by car (or less than half an hour by air), domestic tourists from all over the country and international tourists arriving on cruise ships from Cunard’s Queen Mary, or fly and stay package deals out of China. Tauranga boasts a Total Trade Area of some 284,000 and growing; and in the centre of it all awaits the only major shopping centre in the region, Bayfair.

As it stands, Bayfair is just a retail facility. In the world of advanced and sophisticated shopping centres, it belongs to a bygone era. Tauranga is a modern and vibrant city; its residents live there by choice and their social and demographic profiles are such that they demand the retail, leisure and entertainment facilities available in capital cities. Bayfair Shopping Centre is currently under redevelopment and, when it emerges in its new form, it will present and position itself as the retail, leisure and entertainment capital of the region.

Retail wise, one of the glaring gaps in the tenant mix is in the fashion component. Fashion does extremely well but the range today is limited: Glassons, Rodd & Gunn and Max Fashions. However, there is a demand for a notch upward component to satisfy the affluent and aspirational market. It’s a similar situation across the board; the centre, as it stands, is simply too small!

Two new malls are being added and the existing supermarkets are consolidating and relocating into a new expanded Countdown. More than 50 specialties will be added, bringing the count to about 150 stores.

A new al fresco dining precinct will establish an iconic image for Bayfair, operating from early morning to late in the evening. The architecture provides for an open, shaded precinct during the summer months and, in the words of the designers, “nestles down to create a cosy, comfortable gathering space in winter. A ‘thoughtful space’ designed to provide a bespoke experience year-round.”

Food and Beverage standards around Mount Maunganui are very high, world-class in fact; the cafés and restaurants along the strips are as good as anything anywhere. The development team working on this new dining precinct has set the bar high and promises to provide an industry-leading experience. The precinct is anchored by a gastro pub operated by ‘Lion’ one of Australasia’s largest food and beverage companies, famous among other things for its ‘Little Creatures’ beer, a real favourite in Australia. It’s the latest concept in a line of ‘firsts’ for the company and is destined to become its flagship operation in the Land of the Long White Cloud.

In addition to the dining precinct, the Bayfair redevelopment will feature the largest cinema complex in Tauranga, in fact the largest in the whole of the Bay of Plenty. A top cinema featured greatly in the list of what the trade area residents wanted; according to Ivan Bartley, Development Manager of Bayfair, it was a difficult choice between several operators whom were all aware of the demand.

Successful bidders turned out to be the very distinctive United Cinemas, opening its first complex in New Zealand. United Cinemas is an Australian-owned, award-winning chain of cinemas (the company won an award at a recent Los Angeles international cinema event, for the ‘best cinema of the year’) owned and operated by the Mustaca Family. The Mustaca Family has been in the cinema business since 1987 and has acquired and built eight cinema complexes with a total of 46 theatres across Australia.

Bayfair will be its first New Zealand cinema complex with seven screens and its ‘Grand Theatre’, set to house the largest screen and Dolby Atmos Digital Sound offering in the region. United Cinemas Australian Chairman, Roy Mustaca told SCN that Bayfair was an appealing choice because the centre is about to offer one of the most compelling fashion, lifestyle and entertainment experiences in the country.

“We want to be part of the transformation and offer the people of The Bay of Plenty region an exceptional cinema experience. Each cinema will feature plush stadium seating, 300 electric grand recliners and our à la carte, in-theatre dining menu delivering quality food and beverages to patrons’ seats. With the latest projection and 360-degree Dolby Atmos sound, the cinema will deliver a world-class movie experience.”

You can always tell the state of play when existing retailers opt to relocate and expand. Rodd & Gunn is doing exactly that – expanding to feature its latest, brand new concept store.

Leasing is well under way with a planned staged opening. The specialty component and fashion mall, along with the new and expanded supermarket, will open in November this year. The space, subsequently vacated by the supermarket, will house the new cinema complex which, along with the new dining precinct, is scheduled for opening in 2019.

It’s usual that after redevelopment and expansion, the turnover per square metre of a centre drops a little; that’s understandable. Will this be the case at Bayfair Shopping Centre? SCN thinks not! It’s also ‘usual’ that during redevelopment when parts of the centre are closed, when access is affected and some works are being conducted inside, that turnover drops somewhat. However, at Bayfair, turnover has continued its upward trend right throughout the redevelopment!

In SCN’s view, the redeveloped centre will substantially increase its share of the trade area’s retail dollars. As it stands, escape spending to Auckland is massive, especially in middle to upper end fashion; that is about to be rectified. Add to that the introduction of the dining, leisure and entertainment components, and we have a centre with a significant extension to its trading hours.

But whatever happens, in terms of Specialty MAT/m2, whether the centre increases its turnover, maintains it, or even sees it drop a little, one thing is for sure; Bayfair Shopping Centre will retain its Number 1 position and continue to be the best performing centre in New Zealand.

……

Connecting communities

In our industry, we talk a lot about ‘community’, about social interaction and social inclusion. The practical implication of all this is clearly illustrated at Bayfair Shopping Centre, where, under the leadership of Centre Manager, Steve Ellingford, the management, marketing and operational teams have embraced the concept to leading edge level. As Steve says: “As you begin to work on environmental issues and sustainable business, you realise that everything is connected – businesses, communities and people. Because of that, Bayfair is becoming more and more focused on creating businesses, communities and spaces that are interlinked and fully inclusive. We came to understand that accessibility is not just needed by the 25% of the population experiencing disability, but it is needed by all of us at some stage in our lives”.

‘Be. Accessible’ is a social change initiative managed by the Be. Institute, a social enterprise that aims to work across all sectors and communities throughout New Zealand. Steve Ellingford is a member of the Fab 50, key drivers of the Be. Accessible movement. In 2015, Bayfair Shopping Centre received a Platinum rating for accessibility, the first shopping centre in New Zealand to achieve the rating. Since then, Bayfair has created a number of innovative events for Autism Awareness Month. Sensory Skating saw the Centre offer early morning ice skating sessions for children with sensory processing access needs; the controlled environment eliminated busy crowds, bright lights and loud sounds. It’s part of an ongoing strategy to create inclusive experiences for those on the Autism spectrum. Every Wednesday, Bayfair offers a ‘Sensory Morning’, which involves turning off the centre’s audio and keeping the automatic doors open; and in the lead up to Christmas, the centre holds private Santa photo sessions to children with sensory, intellectual or cognitive access needs. The sessions are held in the morning before most of the stores are open; there are no crowds, no queues and no music in order to avoid overpowering the senses.

In November 2017, Bayfair Shopping Centre won the ‘Hardwired for Social Good Award’ at the Sustainable Business Network Awards. The award is presented to an organisation that is deliberately and consistently improving people’s lives through its day-to-day business practices – integrating social good throughout their entire business.

Minnie Baragwanath, CEO of Be. Accessible, summed up the Bayfair contribution succinctly when she said “Steve and the team at Bayfair are modelling authentic corporate citizenship; they really understand what it means to be a caring business in the local community. Their incredible efforts ensure that every person visiting Bayfair Shopping Centre is offered a beautifully welcoming and inclusive experience. Additionally, the centre’s support of disability sector organisations and events is forming powerful connections among the Tauranga community. Steve’s creative approach to accessibility is an example for us all.” Bayfair Shopping Centre has received many other awards for its social and community initiatives, not the least of which is the SCCA’s Marketing Award for ‘Community’. Angus Nardi, Executive Director of the SCCA said; “Bayfair’s efforts with regard to accessibility are commendable. The centre obviously listened to, and engaged with, its community and made adjustments to suit its needs. The campaign obviously stood out to the judging panel and they have been rewarded.”

About the author

Shopping Centre News

Shopping Centre News is the leading publication for the shopping centre industry in Australia and New Zealand.

SCN is one of the most authoritative publications in the world for the shopping centre industry. Each issue contains articles on Design, Legal issues, Marketing, Leasing, Centre Management and Development. It features contributions by industry experts from around the globe. Shopping Centre News is the only publication in the world that features centre statistics on Turnover, Turnover per square meter and Specialty Shop turnover per square meter for every major centre in Australia.

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