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October 19, 2021

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Too Orangey For Business

Accommodation businesses for sale taking longer to sell in Te Anau

Southland’s market has been running hotter than anywhere else in the country, but Te Anau commercial tourism property interest has slowed as the region continues to navigate the “changing goalposts” of Covid-19. (File photo)

ALDEN WILLIAMS/FAIRFAX NZ

Southland’s market has been running hotter than anywhere else in the country, but Te Anau commercial tourism property interest has slowed as the region continues to navigate the “changing goalposts” of Covid-19. (File photo)

Tourism listed properties are taking longer to sell in Te Anau as people remain cautious about the hospitality industry since Covid-19.

The 15-unit Edgewater waterfront motel has been on the market since October 2020, whilst the 17-unit Asure Explorer Motel and Apartment’s was listed in November 2020.

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Blue Ridge Boutique Bed and Breakfast owner Rebecca Johnston has been attempting to sell her business for eight months as her husband and co-owner Mike has been offered new work in Cromwell.

However, delays in selling the property have meant that her husband has had to travel two and a half hours back to Te Anau on weekends to join his family.

The entire family plans to move to Cromwell as soon as the property sells, however they have received limited interest, Johnston said.

In the meantime, business continues to slow as borders remain closed.

“Business has been very slow [around 10 per cent], most of my guests usually come from Europe,” Johnston said.

“I do have plenty of forward bookings for when borders open.”

Southland District Council deputy mayor Ebel Kremer said imagined people would be more hesitant to purchase tourism properties because the goal posts kept shifting regarding when and if travel bubbles would be open.

“It would be a risk to purchase a tourism business in a tourism town such as Te Anau with regard to borders being closed,” Kremer said.

“I think it’s purely people don’t know what’s going to happen.”

Te Anau had been impacted by recent border closures with eastern Australian states given they usually received the most Australian tourists during school holidays, which many potential visitors were now spending in lock down, Kremer said.

Te Anau had previously not experienced the same influx of Australian tourists as other destinations around the country.

Principal and Tourism, Hospitality & Leisure Real Estate Broker for TourismProperties.com Adrian Chisholm said that whilst some sales were happening in Te Anau, tourism properties were taking longer to sell.

“Banks aren’t lending money as readily, so we’re really looking for cash buyers which limits the market,” he said.

“At the same time, businesses aren’t generating the same income, so values are being reduced.

“Some areas are hurting more than others, unfortunately Te Anau falls into that market.”

Chisholm was confident that the tourism market would restore itself with an influx of quality tourists, as opposed to large quantities of tourists.

New Zealanders were coming further south for longer and spending considerably more money in those regions than their international counterparts, he said. He believed this would have a positive effect on Te Anau.

“Milford Sound is still marketed as the eighth wonder of the world, that’s not going to change,” he said.

But businesses must be prepared to “survive before we can thrive”.

Harcourts Gore sales consultant Trevor Lyall, who is based in Te Anau, said the tourism properties he had seen up for sale were “not moving very quickly at all” in comparison to previous years.

However, Lyall commented this wasn’t necessarily unusual for business sales, especially during a Te Anau winter.

“Commercial properties don’t usually sell as quickly, people are more cautious,” he said.

“Logically, right now people are even more cautious.”