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Kapa Design Gallery retailed art, accessories, jewellery, homeware and gifts on Rees St for nine years.
Its sister business, Toi o Tahuna Fine Art Gallery, moved from Church Lane to the premises above Kapa more than two years ago.
But with the new Kapa store at Queenstown Airport proving popular with passengers and residents alike, owner Mark Moran sold the lease in December, discounted Kapa products by 30% and is negotiating to move Toi o Tahuna to another central resort venue later this year and continue to showcase contemporary New Zealand artists.
''Things change and it was always known I was going to have to move and evolve with the market,'' Mr Moran said on Friday.
''Particularly in Queenstown, things are always changing.
''It's a shame having to leave the luxury of such a large space, but at the same time, it's just the next step.''
One Kapa staff member is due to go on maternity leave while the other two staff members will apply for ski area jobs.
Koko Black, an Australian privately owned chocolaterie, has bought the lease on Rees St.