Napier City Council has spent years telling ratepayers the CBD is the heart of the city’s retail economy. It has now rezoned land that could let a 70,000sq m shopping centre pull that heart’s best tenants out to the fringe.
Mana Ahuriri and TW Property have revealed plans for 30 to 40 shops off Prebensen Drive, across the road from Kmart, Mitre 10, Chemist Warehouse and JB Hi-Fi. The centre comes with 2,000 free car parks, three stages and a 2028 target for stage one. Part of the site, 58 Severn St, was main industrial land until the new District Plan rezoned it for large format retail. Stage one consent applications are due within weeks.
None of this makes the developers villains. Private capital building retail where customers clearly want to shop is the market working. The harder question sits with the council.
The parking gap nobody fixed
CBD owners are not uniformly hostile. Vincent Michaelsen, owner of Vinci’s Pizza and until recently chairman of Napier City Business Inc, dislikes the “heartless” feel of big-box centres but concedes “you can’t deny that appears to be what the population wants.”
Others are blunter. Maree Cooper of Handmade in the Bay says Napier lacks the population to sustain two competing precincts, and if they compete head on, “it would kill us.” Andrew Glenny of Giftware and Engravers says the issue is simpler: “It doesn’t have to be free parking, just more parking. It’s accessibility.”
That is the commercial reality. A fringe centre offering 2,000 free spaces is competing on convenience, and Emerson St has been losing that contest for years.
Mid-tier chains are the real flight risk
TW Property commercial director Terry May argues the 500sq m minimum shop size means the centre will not pull stores from Emerson St. That is true for boutique retailers. It is far less convincing for the national chains Michaelsen names, the Postie Plus, Kathmandu and Macpac type stores that already operate at scale and would happily trade a CBD lease for a bigger floorplate and free parking. He calls them “the bigger concern”, and losing them, he says, “definitely dwindles down the market of the CBD.”
Those anchor-lite chains are exactly what generates incidental foot traffic for the independents beside them. Lose them and the art deco “experience” Cooper is banking on has fewer people walking past it.
The council saw this coming, repeatedly
The pattern is consistent. In 2014, council staff recommended restricting retail types at a suburban centre, warning it could feed “a trend of declining retail occupancy rates within the CBD”, even though a commissioned economic report found little impact. In 2017, then-mayor Bill Dalton said the Prebensen Drive development that became Kmart would hurt the CBD. It went ahead anyway.
The council’s own 2020 Retail Strategy found the CBD held 46% of retail businesses and 54% of retail employment citywide, in a sector then worth $150 million to GDP with 3,100 jobs. District Plan section 32 analysis warned that dispersing retail could damage the CBD’s viability, and the strategic direction report cited overseas malls hollowing out city centres as the reason to protect it.
Meanwhile, the council announced in late 2023 the biggest rethink of Emerson St in 30 years. And in 2025, a run of hospitality closures, Rosie O’Grady’s, Good George and Matisse, showed the strain. Matisse’s Nadia Nazaryeva said then that “you see more struggling than not struggling.”
So ratepayers fund a CBD revival while the planning rulebook makes a competing precinct easier to build. That is not a market failure. It is a council that cannot decide what it believes.
Pick a strategy and own it
There are two defensible positions. One is to let the market decide and stop spending ratepayer money propping up Emerson St against customer preference. The other is to mean what the strategy says, which would involve independent peer review of developer economic assessments, a hard look at whether mid-sized chains belong on the fringe, and fixing CBD parking and access rather than lecturing shoppers about vibrancy. Michaelsen’s complaint that businesses were poorly notified suggests the council has not had that conversation openly.
What it cannot credibly keep doing is flagging CBD harm, then consenting it. The Napier CBD organisation already tracks foot traffic against turnover. Those numbers, before and after stage one opens in 2028, will deliver the verdict. The council gets one more chance to shape it when the consent lands on its desk in the coming weeks.
Sources
- NZ Herald: Napier CBD shops respond to plans for major shopping centre with 30-plus stores: ‘Would kill us’ (2026-10-30)
- NZ Herald: New shops could harm Napier’s CBD (2014-10-28)
- NZ Herald: Kmart development planned for Napier (2017-08-21)
- NZ Herald: Emerson St revamp: Penny for your thoughts on the Napier CBD (2023-12-03)
- NZ Herald: Closing Matisse bar owner’s warning – Napier needs something to happen, and quick (2025-08-26)
- Napier City Council: Napier City Retail Strategy 2020 (2020-03)
- Napier City Council: Draft s32 – Centre and Commercial Zones
- Napier City Council: Section 32 Evaluation Report – Strategic Direction
- Napier CBD: Our Statistics & Data
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