Sydney’s The Rocks facing light rail woes and loss of tourists
Traders in Sydney’s once-thriving The Rocks precinct have been left in limbo as it deals with tough times and a hodgepodge of initiatives.
Once a thriving precinct, The Rocks in Sydney has become a ghost town as traders face a loss of tourists combined with “idiot” public agencies.
On a sunny lunch hour much of The Rocks is empty with cafes and restaurants boasting a plethora of free seats and several major sites including the imposing Observer Hotel vacant.
Veteran pub Phillip’s Foote recently shut its doors after 47 years in The Rocks after its owner was told he needed to invest $5m in demolishing and rebuilding a rear building at his restaurant if he wished to resign the lease.
Chris Kriketos’s family business Bakers Oven Cafe was told it would have to go to public tender to renew its lease with Placemaking NSW after almost 40 years in the district at the same time it was dealing with revenues falling 60 per cent.
The trouble in The Rocks has been brewing for a long time with many businesses saying they are hampered by well-meaning, but poorly delivering public agencies.
A key issue for many businesses in The Rocks is the ownership of property in the district, much of which is leasehold and owned by the NSW state government.
Many operators also said with half the rent relief offered last year taken as a deferred debt, pressure was now mounting on retailers to repay the debts on top of current rents.
Placemaking NSW is a state government advisory committee formed last year to provide “strategic advice” on the management of precincts like The Rocks and Darling Harbour.
Mr Kriketos said renegotiating the lease with Placemaking NSW for his family’s Bakers Oven Cafe was just another hurdle after a stressful year.
Mr Kriketos said they were told the business, which has traded in the precinct for almost 40 years, would need to go to public tender when its lease expires later this year and win the bid for the space.
He said the timing of the move by the state government agency couldn’t be worse as the cafe was dealing with revenues 60 per cent down on where they were pre-pandemic.
“We’ve had so much stress over the last two years going through this Covid storm,” he said.
“This is just another hurdle thrown in front of us.”
Mr Kriketos said the family business, started by his father, was concerned about a lack of tenure and hadn’t yet decided what to do.
“We want a longer lease tenure, another 5-15 years, but they’re offering nothing and saying the space has got to go up for tender,” he said.
Long time hospitality operator in The Rocks, Phillip’s Foote recently shut its doors after 47 years in the district.
Former operator Howard Dredge said he only took the step after he was unable to secure an agreement with Placemaking NSW over a new lease.
Mr Dredge said he’d been told he needed to invest $5m in demolishing and rebuilding a rear building at his restaurant if he wished to resign the lease.
“We said if we spend $5m doing this we’ll need a pretty decent lease, they said no, we’ll only give you 10 years,” Mr Dredge said.
Phillip’s Foote had been grappling with a slew of disruptions that had affected its trading in recent years, including the closure of George Street for the light rail, the demolition of several buildings around Circular Quay, and now the pandemic.
Mr Dredge said since he’d occupied the building, which had been a vacant shell in 1973, he’d spent millions on upkeep and maintenance and couldn’t understand why the NSW government chose to be so difficult.
“Dealing with these idiots (Placemaking NSW), they’re just not commercially minded,” he said.
Nearby, Sydney’s famed Oyster Bar which was forced to re-tender for its Circular Quay space after the NSW government declined to renew its lease after 30 years.
The restaurant, which had started trading from a derelict toilet block in 1988, was not selected for the tender in what its operator Phil Thompson said was inexplicable.
“I feel very sad for the long term operators in The Rocks who’ve had to go through this fairly horrible situation with public tenders and being moved on,” he said
“There was an Italian place. They ended up getting shunted by Places NSW in favour of Starbucks.”
Placemaking NSW, said it was not responsible for “more than half of the current retail vacancies” in The Rocks as they were controlled by subtenants of large leaseholders in the area.
The agency said it had given some businesses as much as an 85 per cent rent reduction.
“For food and beverage retailers, abatements are determined according to reduction of turnover compared to 2019,” it said.
“However, to qualify for this abatement, the tenant must trade for a minimum of five days per week. There is at least one tenant who has refused to do this and therefore doesn’t qualify for the abatement.”
However, many operators in The Rocks said half the rent abatement had been taken as a deferred debt, with pressure now coming on retailers to begin repayment of those debts on top of current rents.
Placemaking NSW said it had tried to work with Phillip’s Foote over the last six months to agree a new lease, or an amendment to the lease agreed to in 2018.
“However they chose not to proceed with either. We are sad to see them go,” it said.
Many other operators in The Rocks bemoaned the management of Placemaking NSW, which they say has changed track almost as many times as it’s changed names and consultants in recent years.
One cafe operator said the area lacked a solid plan and was dogged by a hodgepodge of initiatives and pop ups that sapped business from operators.
“People come in for six months and they do so much damage, and then they move on,” he said.
Business NSW executive manager tourism Greg Binskin said it was clear more foot traffic was needed in the city.
“The state government has done a lot with dine and discover vouchers and al fresco dining,” he said.
However, the dine and discover vouchers are set to conclude at the end of June.
Mr Binskin said consumer confidence was critical for all tourism and dining precincts.
But, Mr Binskin said, The Rocks would be boosted if cruising passengers returned.
“If we can get domestic cruises back we can put hundreds of thousands of people through The Rocks.”
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