Councillors vote for convention centre; mayor promises 200 new jobs

News from Wellington City Council
Wellington City Councillors today voted to support the proposal for a purpose-built convention centre and five-star Hilton Hotel on a vacant site opposite Te Papa.

The next stage is public consultation from 8 July until 8 August.

“This proposal will create jobs, growth and revenue for the city. It’s important now that the public has a say. We’ll be providing a range of information so they can make informed submissions,” says Mayor Celia Wade-Brown.

“The proposed site is in an ideal location, opposite the biggest cultural attraction in New Zealand, Te Papa. It fills a gap in our urban canvas and is estimated to bring $22 million in GDP to the Wellington economy.”

The state-of-the-art 4400 square-metre facility would be able to host up to 1200 conference delegates and have a banqueting capacity for up to 1450 people. It would be built along with a 165-room hotel on the site in Cable Street.

The project would be financed by local developer Mark Dunajtschik. The Council would lease the convention centre at an average net cost to the city of about $2 million a year over the lease term.

All going to plan, the convention centre could be up and running by 2017 – bringing $30 million in new spending to the city each year and directly creating at least another 200 jobs.

Councillor Jo Coughlan, Chair of the Council’s Economic Growth Committee, says she is pleased that one of the first of the Council’s ‘8 Big Ideas’ is on its way to becoming a reality for Wellington.

“We have landed a gem with this proposal,” says Cr Coughlan. “While Wellington is the country’s number-two conference destination, the new convention centre is an amazing opportunity to grow our market share, especially for conferences attracting visitors from Australia and further afield.”

During the formal consultation period, negotiations would continue with the developer and Hilton. The aim is for the Council to be in a position to make a final decision in September.

An overview of the economic case supporting the Convention Centre

• Wellington is the country’s second largest convention destination behind Auckland, making up 15 per cent of the country’s total convention market and earning more than $140 million for the city each year.

• If we do nothing, we could lose up to 17 per cent of that business when other newer facilities are built around the country – that’s up to $25 million in lost business and about 170 jobs.

• This new purpose-built centre would protect that business and, we estimate, grow the overall business in Wellington by about 10 per cent – about 74 new events delivering 68,000 delegate days each year.

• As well as protecting the existing market and jobs, that growth would add $30 million in new expenditure and directly create more than 200 new jobs.

• We expect flow-on secondary development to occur in time in supporting businesses such as entertainment, hospitality and retail.

• A 5-star Hilton would help attract premier industry events to the Capital and support other economic development initiatives such as the proposed film museum and tech precinct.

• We get this for an average net cost to the city of $2 million a year over 10 years on our base operating projections (after accounting for profit share and rates income).

• It would cost the City Council at least $55 million to build a convention centre itself and at least $1.7 million more a year to run – the city would carry all the cost and associated borrowings, and all the risk.

Some details and background information

• The developer is Mark Dunajtschik – an established and successful local developer with a demonstrated commitment to Wellington

• New 165-bed 5-star hotel and purpose-built conference facility with full-format conference hosting capacity of up to 1200 delegates and banqueting capacity for up to 1450 people. In theatre style seating, the facility can seat 2500 in the largest space.

• At the time of completion, the new venue would be the second-largest convention facility in the country and would be completed before the other convention capacity becomes available in other parts of the country

• The venue would be branded, marketed and managed by Hilton which would give Wellington international exposure – and confidence that new events will be attracted to the Capital.

Read also
Should we pay the Hilton $2m a year?

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  1. Sarah Free, 25. June 2014, 10:14

    When the Council backed the convention centre, I raised questions about the risks. Cr Ritchie and I put an amendment wanting more information re contractual and financial risks, but we were voted down. I also voted against public exclusion, as I think there is nothing to hide and it is public money. [via Twitter]

  2. Pauline, 25. June 2014, 12:28

    Thank you Helene and Sarah. As the public was excluded, will we get to read the full minutes of the meeting? or will we get an abridged version?

  3. Ellie, 25. June 2014, 12:41

    Here we go again: public risk, private profit!
    Can we have a breakdown of the voting please?

  4. lindsay, 25. June 2014, 12:45

    Re the voting:
    councillors voted on several recommendations, including to ”agree in principle to support a new purpose built convention centre … subject to community consultation and any final negotiations and due diligence required”. Helene Ritchie was the sole councillor to vote against that recommendation. She and Sarah Free also voted against delegating authority to Mayor Celia Wade-Brown and chief executive Kevin Lavery to sign off the consultation material.

  5. Nora, 26. June 2014, 20:36

    On the 14th March in a Dompost report the WCC CEO said that the council was working in partnership with a developer and an international hotel chain on the prospect of a new convention centre and five star hotel. One has to ask when councillors were first involved in this consultation, or have they – like the public – been excluded until this last week.

    From what I hear, it is not the hotel/convention centre but the contribution of millions over the next 10 years which is of concern to he average ratepayer.


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