Road closures and rising costs force closure of Nelson business

A longstanding Nelson cafe and food store has been forced to close because of rising costs and the loss of customers due to ongoing roadworks.

Prego Mediterranean Foods & Comida Cafe is shutting its doors after 19 years. It announced its closure this week and is now under the control of a liquidator.

Owner Claudia Kern said the closure was a result of economic pressures that began during Covid-19, the economic slowdown that followed, the ongoing impact of road closures due to extensive central city infrastructure upgrades, and rising freight costs due to the Iran War.

"You look at the money coming in and you have rent to pay and you have staff wages to pay and then, what are you going to pay the other bills with?"

Kern said breaking the news to their eight staff was "just horrendous". Their assistant retail manager, Lynda Dyce, had been with them since they bought the shop 19 years ago, and with the previous owners for another four years before that.

"It's not so much about us, we worry about our staff," Kern said "These people worked for us and they've been good for us and we are responsible for them, and I can't meet that responsibility anymore now, so I find that really upsetting."

Kern and her husband Mac bought the business in 2007 and initially stocked mostly Italian food, before expanding their offering to include items from across Europe. She said in the early days there was nowhere else in Nelson that sold prosciutto.

"People were always disappointed we didn't have scones and I always felt like saying, 'This is a Mediterranean place, they don't do scones in Italy.' But sometimes you've got to give customers what they want, so we had muffins and we had berry crumble and stuff like that, but we've always had Italian chefs in our kitchen."

Nelson's underground infrastructure upgrade

The business has been impacted by Nelson City Council's upgrade of underground water infrastructure along Bridge Street, in the CBD, which began in September 2025 and is expected to run until June 2027.

Comida backs onto Buxton Square, which is adjacent to Bridge Street, and Kern said work on Alma Street, which connects the two, meant there was a six foot fence across the cafe entrance for several months in the lead-up to Christmas.

"You couldn't even see the place. We spent money on advertising, we had Facebook posts every day trying to be humorous for a while, and just nothing helped. I had all these bills I had to pay and I had three people sitting in the cafe. You can't operate like that."

Kern estimates they lost around $50,000 in revenue in the final two months of last year.

"I do understand that infrastructure needs to be built. I had a meeting with council two months after we'd been basically locked in behind this fence. Somebody from council finally came and talked to us and I said, 'Why on earth are you doing all these big projects all at the same time? It is keeping people from coming to Nelson'."

She said she was told the council had received funding from the government for the Bridge Street project that needed to be spent within a certain timeframe.

At a meeting with council staff late last year, Kern said she made suggestions around increasing free parking and a social media campaign about the road closures and businesses - both of which had since been implemented.

Last month, the council announced parking in the city's four major carparks would be extended to two hours as part of a winter trial until August.

Kern said she did not think Prego & Comida would be the last small business in Nelson to close during the infrastructure work.

In recent months, she had been washing dishes at rest homes occasionally, to bring in extra money, and there was no time for a break after the cafe's closure.

"We've still got rent to pay at home. I'm no different from any of my staff, I'll be looking for a job."

Council acknowledges upgrade impacts

The Nelson City Council is upgrading underground water infrastructure along Bridge Street for a $78 million project called "Bridge to Better", which aims to enable inner city development and reduce flooding in parts of the city.

It has received $36.3 million in funding from the government's Infrastructure Acceleration Fund.

The council announced last week that an eight storey inner-city hotel and apartment complex would be built on the former bus-hub site on Bridge Street.

Mayor Nick Smith said the development was possible in part because of the infrastructure upgrades.

"We have had previous proposals for multi-storey developments in this part of the city, but they could not be progressed because the water and wastewater infrastructure did not have sufficient capacity."

Since the work began, retailers have spoken publicly about how the road closures have affected their customers and called on the council to provide rates relief.

Nelson City Council's executive director of delivery, Alec Louverdis, said he was sorry to hear about the closure of Prego & Comida.

"While the Bridge to Better project will result in significant benefits for our city centre, and recent investment announcements like the new hotel and apartment complex by Safari Group point to promising early signs of revitalisation, we recognise that this is a difficult time for businesses, especially those affected by works on Bridge Street."

Council officers were assessing how a rates deferral scheme could work and would present this to council.

"Throughout the project we have worked with businesses to lessen the financial impact of the work through a business disruption mitigation plan," he said.

That included promoting businesses as being open despite the road closures, information in its community news publication and on social media, the extension of free parking, waiving outdoor licenses, and business mentoring and wellbeing support delivered through the Chamber of Commerce.

Louverdis said the council would continue to work closely with those on Bridge Street for the duration of the project.