Retailers at Auckland Airport have begun opening up after a two-year hiatus for most, but the country’s busiest airport warns not all will have their doors open this year.
Just 30 per cent of Auckland Airport’s some-90 retailers have their doors open for travellers, inline with the recovery of international passengers. And while more and more are preparing to open up in coming months, staffing issues are the biggest barrier at present.
Mark Thomson, head of property and retail at Auckland Airport, said retailers in both the international and domestic terminals want to open back up for trade but a lack of staff was making it difficult for most.
Most businesses that are now open are operating at limited hours.
Thomson said the Airport’s current focus was reopening the international terminal. “We’re thrilled to start to see a return of passengers to the terminal but what we’re focused on at the moment is working with our retailers and reopening,” Thomson told the Herald.
“A big part of our business has been in hibernation for a little over two years.
Just two food and beverage businesses are open airside at present – Vantage Bar and Best Ugly Bagels, albeit operating limited hours, and McDonald’s and Retro Caravan are the only two food businesses open landside at present. McDonald’s airside remains closed.
Emirates Leisure Retail’s Vantage Bar has stayed open through the pandemic, as have duty free retail operators The Loop and Aelia.
Typically, pre-Covid-19 pandemic, a total of 28 food and beverage operators would be trading in the international terminal, 14 airside post-security.
Through May and June, 10 more retailers are expected to open again: Hayama Sushi (both airside and landside), Oma café (landside), Popo Dumplings (airside), McDonald’s (airside), The Juicery (airside), and Better Burger, Mexico, and Tea Garden (all airside).
Auckland Airport has facilitated approximately $180 million in rent relief each year for retailers spread across the international and domestic terminals since the onset of the Covid-19 pandemic, and this has continued into FY22.
Spending in the terminal is driven by passenger volumes, and while the borders have opened up to tourists from 60 waiver-free countries, volumes are still well below the daily average pre-pandemic inline with sales and spending with merchants.
Pre-pandemic, Auckland Airport welcomed one million international passengers each month. Currently, just 28 per cent of that has recovered through the international terminal.
“A big part of the work we’re focused on at the moment is getting the retail and food and beverage operation open and back up and running again, recognising that retail and food and beverage propositions are a key part of the overall travel experience,” said Thomson.
“The challenges we are facing there are around staffing and stock levels.”
Thomson said its retailers were not immune to the difficulties securing staff that the wider retail and food and beverage industries, along with most sectors, were facing at present.
“The retailers are not operated by Auckland Airport so the challenges in their experience are getting staff and getting in position to reopen.
“We’re only operating at 30 per cent of passenger volumes at the moment, which is also a consideration for a number of the retailers.”
Pre-pandemic, Auckland Airport retailers were open for trade approximately 20 hours a day, operating three shifts to service the typical three passenger peaks.
“We operate a 20-hour operating day, that could be a three shift pattern in the international terminal, so unlike a lot of conventional high street retail, for a three shift pattern; stores that may require 20-odd staff can require up to 50 or 60 in the international terminal so it is a little bit challenging at the moment for some and we’re trying to help them through that.”
Retailers in the Airport’s luxury precinct, housing global fashion houses such as the likes of Kate Spade, Hugo Boss and Coach, was facing issues with stock as a result of global supply chain issues, Thomson said.
“We’re going to see some gradual and consistent reopening of stores.
“When will we see full opening? I think it is going to take a little bit of time. We’ve just got to encourage as much as that to open as soon as practical bearing in mind the challenges that our tenants are facing.”
Thomson was hopeful – but could not guarantee – that all of the retailers in the international terminal would be back up and running by the end of the year.
“All 90 per cent of pre-pandemic markets are open [for travel] now so we’re very excited andwill work hard to make sure that we get as many of our products and offerings back open to the public. It is going to take time – it is not going to happen overnight – and we ask people for their patience.”
Auckland Airport says just two of its tenants have shut stores in its terminals since the start of the pandemic, and it has since welcomed to new additions: PB Tech and Swarovski.
The Airport is currently building a 120-store outlet shopping mall on the site of the former aviation golf course. Earthworks is currently underway for the 23,000sq m site of shops, which will centre around fashion, accessory, and footwear brands with food and dining. The centre is expected to generate up to 500 new jobs.
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