A $23-million Bunnings store is set to open in Tauranga next year – just down the road from Mitre 10 MEGA.

The Australian-owned hardware retailer’s news has been hailed as a win for Tauranga shoppers and tradies given the two brands “aggressively compete in price”, and because it would bring new job opportunities and see a long-vacant site tidied up.

“Opening soon” signs have gone up on fencing at the former Gilmours site at 1150 Cameron Rd, Gate Pa about 500 metres away from Mitre 10 MEGA.

The announcement comes about a year after a company linked to the Mitre 10 MEGA store was fined $500,000 for engaging in anti-competitive conduct to prevent Bunnings from opening nearby.

Work has started to prepared the former Gilmours site for construction of a new $23m Bunnings retail store. Photo / Sandra Conchie.

In a statement, Bunnings told the Bay of Plenty Times it was “looking forward to bringing a new, smaller format Bunnings store” to Tauranga.

Bunnings’ overall investment for the new retail store was $23m and “about 50 staff” would be employed.

The retail space of the site was about 4500sq m including a nursery area, and there would be 80 car parks.

“We’ve started some works to prepare the site for construction and we’re hopeful of a mid-2025 completion date.”

Bunnings already has a retail store in Mount Maunganui and a trade store in Tauriko.

Court documents show Bunnings acquired the former Gilmours site in 2018 for $7.9 million.

In 2019 NGB Properties Ltd, the then sister company of the Mitre 10 MEGA Tauranga operator bought the site next door to the former Gilmours site.

After an investigation, the Commerce Commission accused NGB Properties Ltd of putting a covenant on that site preventing it from being used as a hardware store, to stop Bunnings from opening. In 2021 the covenant was lifted and the site was sold to another party.

NGB Properties was fined $500,000 in the High Court at Wellington last year after admitting the covenant breached the Commerce Act.

Mitre 10 MEGA in Cameron Rd, Tauranga. Photo / Mead Norton.

Tauranga Business Chamber chief executive Matt Cowley said Bunning’s Cameron Rd development had advantages for tradespeople, retailers and shoppers.

“Firstly, it shows that brick-and-mortar stores are far from dead with significant investments like these happening across the country. Consumers still want to buy in store and take it away, unlike buying online and waiting for the delivery a week later.

“Having these two retailers aggressively compete in price is good for tradies and shoppers.”

For transparency, Cowley noted Bunnings was an alliance sponsor of the NZ Chambers of Commerce.

Tauranga Business Chamber chief executive Matt Cowley. Photo / NZME.

Cowley said mainstream retail was generally a “high-volume, low-margin business model” and retailers aimed to achieve economies of scale with bulk stores and bulk-purchasing power.

He said having the two competitors operating nearby on the same road, was “market forces at play”.

“As long as there is a good selection of players in the local market, such as Placemakers, ITM, Hammer Hardware etc, the competition will be good for consumers.”

Cowley said Bunnings and Mitre 10 MEGA stores served a diverse range of customers, and not everyone was just after the cheapest item.

“Consumers weigh up several factors, such as personalisation, service, range, convenience, as well as the best price.”

Tauranga Mayor Mahé Drysdale said the proposed Cameron Rd Bunnings store still had to go through the building consent process but represented “an exciting opportunity” for Tauranga’s growing city.

Tauranga Mayor Mahé Drysdale. Photo / Alex Cairns.

“It will bring jobs, boost our economy and provide more options for tradies and shoppers. It is also great to see vacant lots in Tauranga being developed and is hopefully a sign that the market is picking up.”

Te Papa ward councillor Rod Taylor said it was “wonderful news” for Tauranga.

“It’s great to see this site is going to be tidied up and developed after sitting vacant for about 10 years. It will help add some vibrancy to the area.”

Taylor said this development also created potential employment opportunities for people living in Gate Pa and Greerton and more choices for customers and tradespeople.

“I congratulate Bunnings for the faith the company has shown us by investing in our city.”

Tauriko ward councillor Martin Rozeboom said it was especially “good news” for Bunnings customers currently having to travel to the Mount Maunganui store.

“I’m quite in favour of having more competition between retailers and businesses as it gives shoppers a greater choice and the opportunity to compare prices.”

Rozeboom said he regularly shopped at both businesses as each had a different range of items and healthy competition was good for everyone.

Mitre 10 New Zealand was approached for comment.

-Bay of Plenty Times.