However, South Dunedin businesses say they would welcome the giant store in the neighbourhood — arguing it would bring more traffic into the area and liven up its struggling commercial centre.
When asked about the Dunedin City Council resource consent for the Smiths City site in Andersons Bay Rd to be used for four years as a Kmart department store, a spokeswoman from the Australian retailer said it was still looking for a new home.
"We are continuing our search for a suitable premises in the city, but have no confirmed location at this time. We will update the community if this changes."
The spokeswoman said the company would make a formal announcement once details were confirmed.
Reacting to the news the large retailer could be about to set up down the road, retailers in King Edward St were enthusiastic about Kmart’s ability to draw shoppers into the area.
One shop assistant said economic analysis suggesting some South Dunedin retail shops would probably close was "bull....".
Their main competitor would be The Warehouse, the person said.
Elio’s Gun Shop co-owner Sue Chiminello said she expected more people to come to South Dunedin as a result.
"We need shops out here. We’ve got a lot of cafes, we’ve got a lot of insurance ... we haven’t got a lot of retail shops that bring people out here.
"South Dunedin definitely needs it. I think it will be a good thing."
She also doubted it would damage business for stores like hers.
Alex Campbell Menswear owner Lindsay Campbell said he would welcome Kmart to the area.
It would fit in in South Dunedin, he said, with a number of other big-box retailers such as Pak’nSave, Mitre 10 Mega, Bunnings and The Warehouse already in the area.
"As for some of the smaller retailers, they are offering different products and a different level of service and quality to what you might expect at Kmart."
Kmart’s effect on smaller South Dunedin retailers like his would be minimal, he said.
"I can’t think of anybody out there that’s going to throw their arms in the air and surrender and think, ‘woe is me, we’ve got Kmart coming to town’," Mr Campbell said.
"They’re in Dunedin, for goodness sake ... eight minutes from South Dunedin by car [to the old site]."
Variety shop Happy Coins owner Stephen Norgate did expect some stores to lose business to Kmart and potentially close.
"Most probably true; hopefully not me.
"I try my hardest ... [we will] see how we go."
He described the Smiths City location as "stupid" because there would not be enough parking in the area to accommodate Kmart.
"They’ve only got that little bit in front of the shop.
"I wouldn’t be very happy if I was one of the food places ... they need those parks and people stay in Kmart for maybe an hour."
He was sceptical Kmart would bring more customers into the area or more to his store.
