Auckland’s tourism draws major investment opportunities

Q: How has Auckland’s tourism story evolved? 

A: Traditionally, Auckland has always been viewed as the gateway to New Zealand. There hasn’t been enough talk of New Zealand’s urban offering, due to so much focus on nature and the environment. So, our fundamental premise has been that there are compelling reasons for people to stay in Auckland. You can have that nature experience in an unpolluted city that’s established on a bed of volcanoes with black sand beaches, as well as an emerging world-class city that is undergoing a significant period of growth at the moment, largely driven by NZD$26bn ($16.6bn) investment from the public sector which is being pumped into the city on critical infrastructure, and the NZD$10bn coming in from the private sector.

We’re seeing a city that’s really beginning to emerge from early adolescence into early adulthood, and much of that is due to its reorganisation from a political standpoint. We were previously seven different borough councils, who were competing against each other. It wasn’t working, so we amalgamated the councils into one super city. This means that investors have a clearer path to navigate when dealing with the city. 

We have successfully hosted the Commonwealth Games, staged games for the FIFA U-20 World Cup and the Cricket World Cup with Australia, and a range of other more localised events that have appealed to those from the Asia-Pacific region. As a result, our visitor numbers have grown steadily year-on-year - we’ve got more than 2 million, annually, not least due to the growth of airline carriers - we now have 30 - and increased demand from China’s middle class. Auckland airport is undergoing a period of growth, with a second runway to be added within the next 30 years. Thinking long term, we’ve been looking at how do we increase our capacity while minimising the impact of the additional visitation on our communities. 

Q: Which nations are your key targets?

A: Australia is always going to be a critical market for us, there are about a million spare seats coming across the Tasman Sea each year, and we’re working really hard with our partners to fill those. Our research tells us that particularly during the winter period, Australians are predisposed to visit here, but need to be given more incentives. 

China is obviously a very large market for us. New Zealand has a long-term appeal to China, and the numbers coming out of that market have been phenomenal. There’s significant Chinese investment too, particularly in hotels. We’ve got a new Fu Wah Park Hyatt development due to open later this year. 

The other key market for us is the US, and we’re getting quite steady growth out of there.  Our national carrier has extended its roots into the US, and now flies out of San Francisco, Los Angeles, Houston, and Chicago.

Q: What are some other specific opportunities?

A: Hotels have been driving the most foreign investment in recent times. Due to major investments recently, we’re going to almost double our capacity with almost 4000 new rooms coming into Auckland over the next five years. In 2021, we’re hosting the Americas Cup, the Women’s Cricket and Rugby World Cups, the World Softball Championship and a range of other events.

We’ve also got a new billion-dollar development that’s taking place on our waterfront called Commercial Bay, a game-changer in terms of the retail and food and beverage offering that we’ll have in the central city. In addition, we’ve got New Zealand International Convention Centre, extending our capacity to host large scale international business events. We also have Grid Auckland, an area where start-ups come together to work and co-create.

We have listed around 17 compelling investment projects in our prospectus. For example, underneath one of our main central parks in the city, there’s a network of old World War Two shelter tunnels that we want to restore. There’s a large amount of investment still being sought for the expansion of the airport to meet that demand and growth. Many billions of public money are being poured into a new central rail loop, effectively an underground system that’s being built under Auckland.

Auckland is really starting to emerge as a compelling location for film and television production; we’re seeing a lot of the big international players wanting to set up here. But throughout creative industries and our tech sector we’re seeing Auckland emerge now. More than $2.4bn of Auckland’s GDP came out of the screen sector in 2015 and has continued to grow by about 5% annual growth each year.