Queenstown Mall and surrounding waterfront streets were flooded after a water main burst on Wednesday evening.

A burst water main that flooded central Queenstown is a "reality check" the resort's infrastructure cannot keep up with tourism, a town business advocate says.

Downtown QT manager Steve Wilde says a visitor levy could help prevent a repeat.

Part of Mall St is under repair after a water main burst last Wednesday evening, pushing up pavers and sending water gushing into Lake Wakatipu.

Dasha Kuprienko A new pipe was installed in Queenstown Mall on Monday after a water main burst on Wednesday evening.

Wilde said visitor numbers were rising and town's under-pressure infrastructure could not keep up, he said.

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"The fact that the piping was working at the very top of its designed limit sends a message that this is indicative of what's going on throughout the whole of this district and our infrastructure is under enormous pressure."

DASHA KUPRIENKO/STUFF The flooding damaged this central Queenstown street.

Using a visitor levy to help improve infrastructure was an "obvious" option, Wilde said.

"We can see it happening in the mall with the blow-out – that we probably need a bit of help in Queenstown, and I'm talking to the government here."

A new water pipe was installed on Monday.

Queenstown Lakes District Council spokesman Naell Crosby-Roe said contractors Veolia would install a rider main to provide resilience and secure the water supply.

Contractor Downer would finish re-levelling the underlying surface and re-laying the cobblestones in about two weeks.

Businesses in the lower half of the mall – including Winnies Gourmet Pizza, Ballarat Trading Company and Madam Woo – could not have outdoor seating while the area was fenced during repairs.

"They are just getting on with it and we just want the council to move through it as quickly as they can," Wilde said.

The repairs would prepare businesses for a full Mall St renovation late next year, Wilde said.

"This is a bit of a taste of what it is going to be like," he said.

Shops on Mall and Rees streets were back in full swing the day after the flood.

Wilkinson Pharmacy worker Lorraine Long said the water burst caused "a little bit of drama".

"It was all right. It just cost us money and customers and caused inconvenience, " she said.

"It was just a bit of a mess and we were worried it [water] was going to come in."