Queenstown hospitality operators have been hit with an avalanched fee increase, from $3200 a year to $51,000 for outdoor dining spaces.
Outdoor dining fees in Queenstown have been hiked almost 1600 percent, which in some cases has cost businesses an additional NZD $51,000.
Following COVID-19 restrictions, the Queenstown Lakes District Council had planned to progressively increase outdoor dining fees, in what was promised would be based on 30 percent of the value of the indoor rent.
One local hospitality business owner who has two properties in the Queenstown Lakes region said that the fees sat at NZD $3200 a year for the past five years, and has now clocked up to NZD $51,000. Whilst it didn’t financially make sense or add up for him, it would also equate to an additional 60,000 drinks per year that would need to be sold.
Although there has been ongoing public consultation on the policy, it didn’t include the actual fees the council had planned on charging.
Business owners and operators in the region were frustrated that the council had not consulted with them before the decision was finalised. Others said that the 30 percent the council used should not apply to Queenstown, where it was often cold and windy, making it an unpleasant environment for al-fresco dining.
There were also suggestions that instead of hiking fees drastically, a more moderate approach of four or five percent per year would have been more manageable for businesses.
Industry leaders have said that outdoor dining is a real benefit for hospitality businesses, and something that should be paid for. However, the increases have been greatly inflated.
As global retailers are likely to pay higher rents, the amount expected for local business owners to fork out is more than many can afford while staying profitable.
New fees introduced in Tauranga at NZD $150 per square metre are just below the highest fees in Auckland of NZD $154 per square metre.
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