Big hikes in rent will 'push operators out of business'

6:00 am on 11 March 2011

A Christchurch businessman is calling for legislation to prevent price gouging on business rental properties.

The leader of a small- and medium-sized business action group, Matthew Carpenter, says rents have risen by up to 150% since the earthquake.

Mr Carpenter says prices are untenable for many small operators and will push all but big retail chains out of business.

But the Wellington general manager of Robt Jones Holdings, Sam Cooper, says legislation is not a fair solution and would slow reconstruction down.

He says landlords should not ask for inflated rents, but there is nothing wrong with high demand pushing up prices through bidding wars for sought-after properties.

Bidding competition 'pushing up rents'

Hamish Doig, of the commercial property firm Colliers International Christchurch, also believes that legislation would be inappropriate.

Mr Doig says tenants are outbidding one another on commercial properties and that is what's pushing up rents.

Prime Minister John Key says he has had no advice about allegations of price-gouging. He says the Government is looking at how it can provide space for businesses outside the city's central business district.

Noting that legislation may not be practical, the Labour Party says it may be better to name and shame any firms that are price-gouging.