Archive | Business precincts

Double-dipping accusation in business improvement districts gets council backs up

Published 1 January 2012

Additional material at foot of story 3 January 2012

When you’re going to accuse a city council of unfair practice, it’s useful to get your terminology right.

Westfield (NZ) Ltd & the Shopping Centre Council’s representatives – having got their terminology wrong – left the Auckland Council free last month to ignore their criticisms of the new policy on business improvement districts.

The criticism might have been more accurate if Auckland had stuck with the Mainstreet promotional model, created for the old main streets to compete with the new out-of-centre malls, but the model has evolved from the purely retail focus to include all business types within an area.

Westfield representative Graeme Heap’s suggestion that the company could be very litigious if it didn’t get its way with its accusation of double dipping hardly helped. Litigate all the way to the Supreme Court, mate, but if the accusation’s ludicrous you’re not going to succeed.

The Urban Dictionary is as good as anywhere to track down a definition of double dipping: You dip your chip into the sauce, take a bite then dip the half-chewed chip again – complete, of course, with an army of baddies that were waiting in your mouth to hop on half-chewed food at the exit.

The point is, you do it. The accusation by Connal Townsend, representing Property Council autonomous unit, the Council of Shopping Centres, and repeated by Mr Heap at the Auckland Council’s regional development & operations committee meeting on 15 December was that, after the shopping centre manager took a bite for marketing, the council came along and took a bite. 2 bites by different eaters, not double dipping.

A semantic difference? The accusation ought to have been that the Auckland Council took its bite for identical purpose, which might have been akin to the courts’ double jeopardy.

Mr Townsend said shopping centres had a co-operative marketing mechanism – “A very substantial levy is charged, up to 80% of the marketing cost of the shopping centre” – and those retailers were being asked to pay the marketing budget twice, “once for the business improvement district down the street and once in the shopping centre. We’re really asking you to adopt a policy of excluding shopping centres on the grounds that, if you include them, you’re asking a double dip”.

Mr Heap did his best to get committee members’ backs up, telling them Westfield was “vehemently opposed to a shopping centre being included in a business improvement district in any sense. I’m not asking you to like a mall or its environment. We have over 100 million visits from people who do like them. I suggest if you really want to improve business districts to provide more parking and make it free.”

Mr Heap then boasted that, “by virtue of the location of most of our centres, we attract people to the business improvement districts and the shopping strips. In Newmarket, we pay 15% of the business improvement district budget and get one vote. Out of the $1 million budget, $300,000 is spent on marketing. That is a pretty inefficient marketing ratio, compared to the $800,000 we spend on 277.”

But hold on. Newmarket Broadway was an established & highly successful shopping strip long before the 277 mall was built (by another developer), success cemented in place when the old Newmarket Borough Council was able to create a rating advantage over Queen St shops courtesy of the borough’s near-100%-commercial rating base.

Westfield bought properties across the road from 277, worked on plans for a competing mall, bought 277 and had every intention of swamping the shopping strip, though it’s since reduced those development plans.

Unlike the picture painted at other business improvement districts, where tenants were encouraged to participate, Mr Heap first attributed the cost to Westfield itself, which he said got just one vote, then commented: “We pass all the cost to our retailers and it is their cost. We think it’s unjustified & unnecessary and it’s a double dip.”

Mayor Len Brown rejected Mr Heap’s stance: “We are sitting in a partnership with Westfield as we sit in a partnership with all companies across the region. We are trying to build our centres right across the region as well as the centre (cbd), but some are really struggling and it is critical that we do everything we can to achieve the collaboration.

“The thing I’m struggling with here, a lot of companies spend a lot of money supporting their own brand, but the bigger brand is Auckland. Is it your view that you want to stand alone from the big brand or do you wish to work collaboratively?”

Mr Heap: “Absolutely, we wish to work collaboratively. Working together doesn’t mean we should be paying more. We will work collaboratively together, but we don’t consider that paying extra to support our competitors out on the street is fair. Why do you think they’re not working (the shopping strips)? It’s got to do with foot traffic, it’s as simple as that, it’s a simple business thing. I take St Lukes as an example, it’s not in a business improvement district. The business improvement districts were created to compete against it. It creates its own parking, its own security.”

Amanda Kinzett, of the Onehunga Business Association, said every retailer within the Dressmart mall had a vote “and I wouldn’t have it any other way. It’s about moving Onehunga forward as a collaborative approach, not just individuals.”

She said key performance indicators didn’t have to be just foot traffic: “We deal with community, networking, migrant business programmes, we work throughout the community to support all our businesses. All our parking is free. When I drop into my local Westfield it’s not covered parking – the same as the street. We have our own cleaning, security – better than 277, may I say. People feel safe coming into a community centre. The kids respect the area.”

The committee resolved to adopt the business improvement districts policy, but agreed to review it in 24 months, given the range of feedback.

The issues of relocation of subsidies provided to ex-Manukau business associations, and the previous suggestion of a contestable fund for business improvement district initiatives from this source, will be considered as part of the report to the councils strategy & finance committee in March on the proposed reallocation of any regionally allocated local economic development budgets to local boards.

Council business area planning manager Janet Schofield acknowledged in her report the desire of some business sectors – particularly shopping centres & some bodies corporate – to be excluded from the programme or pay a discounted rate, and be considered as a special case for their large scale & existing co-operative marketing programmes, security & cleaning provisions. However, she said various other sectors undertook similar co-operative programmes.

“The principle on which this policy is based is inclusion of all businesses within a business improvement district boundary area to further the collective aims of the programme. All sectors can contribute to and gain from the joint initiatives of the business improvement district programme, raised profile & improvement to the business environment, recognition & influence that comes with a business improvement district partnership.”

Often, she said, the focus was on networking & development, security, innovation, transport, skills & training.

Westfield and the Shopping Centre Council’s position won some support from other submitters, but not for the same reasons. Karen Remetis, of the Town Centre Development Group and Towns & Cities NZ, said malls & big-box retail weren’t recognised as business improvement districts anywhere in the world, because business improvement districts were set up to fight back against them.

Auckland has 46 business improvement districts, of which 16 wanted to expand their boundaries, and there were indications another 25 could be formed over the next decade.

The council has proposed a $300,000/year contestable fund for business improvement district initiatives, but the proposal came too late to make it into the draft council long-term plan. It can still be considered if submissions on that draft long-term plan raise the need for additional business improvement district funding.

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Attribution: Council committee meeting & agenda, story written by Bob Dey for the Bob Dey Property Report.

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Holmes wins study tour on business improvement & transport efficiency districts

Published 23 November 2009

North Harbour Business Association general manager Gary Holmes has won a fellowship that will take him to the UK, Canada & the US to study leading business improvement districts which have a partnership with a transport management association.

 

Mr Holmes, a former North Shore city councillor, is one of 13 recipients of the Winston Churchill Memorial Trust Fellowships for 2010.

 

The business association’s chairman, Gray Pearson, said transport management was the main platform of the North Harbour business improvement district and he believed the proposed programme of investigation would significantly benefit development of a transport efficiency district.

 

“Gary is well acquainted with the key issues facing the North Harbour business area as it relates to transport and has already introduced a number of initiatives which will contribute to addressing the problems we face. This opportunity will assist in up-skilling him so he will be better equipped to carry out his duties as manager of our transport efficiency district and ultimately lead to better decision-making on behalf of the community.”

 

Mr Holmes said wanted to investigate & capture knowledge of world best practice of partnerships between business improvement districts & transport management associations.

 

The North Harbour transport efficiency district programme is the first in New Zealand and, like other programmes the North Harbour Business Association is undertaking, such as its community crime prevention initiatives in conjunction with the police, is recognised widely as an example for other business areas.

 

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Attribution: Association release, story written by Bob Dey for the Bob Dey Property Report.

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Councillors adopt business precinct priority list

Published: 6 July 2005


Auckland City councillors adopted a priority list of business precinct plans today, appointing councillor sponsors “to guide & participate in the development of” 2 of them.



The Tamaki plan is already well under way. Ian Maxwell, the council’s group manager of implementation planning, told the economic development & sustainable business committee he got material on the Tamaki structure plan back yesterday and it would be in shape for presenting to the council in about 2 months.


Following Tamaki, the 2 priority groups are:


2005-06:

Rosebank
Roma & Stoddard Rds
Sylvia Park/Mt Wellington/Carbine Rd

2006-07:

Otahuhu/Mt Richmond
South-eastern Edge/Southdown, Penrose/Ellerslie
Mt Wellington Highway.

Cllr Vern Walsh (City Vision) was appointed a sponsor for the Rosebank plan and Cllr Linda Leighton (Citizens & Ratepayers Now) for the Roma/Stoddard plan.


Acting group economic development manager Karen Lyons said there was momentum at Rosebank, but the Roma/Stoddard plan was starting from scratch.


In their report, Mr Maxwell & Ms Lyons said Auckland City was the workplace for 267,000 people and contributed 50% of the Auckland region’s & 17% of national gdp. “However, Auckland’s level of gdp/head remains below Australia’s urban economies, pointing to the need to raise economic performance. Furthermore, Auckland City is competing globally to attract & retain increasingly mobile labour & investment.


“Competition between cities is based on providing the ‘best’ combination of location factors including open space, quality education, efficient transport, career opportunities & opportunities for leisure & recreation.


“The development & refurbishment of business precincts across Auckland City is aimed at enhancing the city’s competitiveness as a business location, making it attractive to high value-added firms & talented workers. In addition, given population growth forecasts, if Auckland City is to retain its current population:job ratio, some 80,000 additional jobs within the city will be necessary by 2021.


“The business precinct work is strategically linked to Auckland City’s growth management strategy, the current council’s strategic objective around a flourishing economy, regional strategies (the regional growth strategy & the Auckland regional economic development strategy) and central government’s growth & innovation framework.”


They said the city’s growth management strategy identified areas of change where accelerated development would be facilitated through new regulations and enhanced community infrastructure & utilities.


They’ve put together diagrams combining the priority lists for urban living areas with business development areas (click on map to enlarge; hopefully a better version will be on the website shortly).


“Urban living areas are focused on a city or town centre and provide for office-based, retailing & a range of mixed service business. Business development areas form the heartland of Auckland’s economic activity. These areas contain a wide variety of business activity, including manufacturing, transport, wholesaling, personal & commercial services, as well as retailing.”


To increase the number of higher-value jobs & reduce unemployment, especially for youth, the council proposes to:

reduce business rating differentials
lead in the creation of attractive precincts for business
welcome & celebrate business
involve business in decision-making
increase certainty regarding consents made under the Resource Management Act, and
increase information regarding infrastructure plans.

With others, the council would address infrastructure requirements over time, in particular:

reducing travel times for people & freight
enhancing the capacity & speed of telecommunications, and
increasing the long-term reliability of electricity supplies.

It would also align & promote economic development initiatives and increase the availability of skilled staff.


The report said that to implement the growth management strategy, staff & resources from across the council were being brought together under the urban living programme to ensure effective co-ordination of both planning & actions.


Earlier story:


27 March 2005: Pressure advances Auckland City strategic work


 


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