Centre precinct's $500m price tag queried

22:02, Aug 08 2014

The Government will fund and own Christchurch's new convention centre, with private partners taking care of the surrounding precinct.

This week Prime Minister John Key said that Christchurch's Carter Group, Ngai Tahu Property and Australian-based Plenary Group had been selected as the preferred developers for the major anchor project.

Global hotel group Accor had been chosen as the preferred convention centre operator.

The Crown will spend $284 million on buying the land and building the purpose-built, 2000-seat centre.

In total, the project will cost more than $500m.

Christchurch economist Eric Crampton yesterday said he was concerned about the cost and called for the public release of the project's business case.


He believed that Christchurch could end up fighting for its share of money-making international conferences in an "overly saturated market".

"It's pretty hard to tell whether the convention centre precinct offers value for money on the information currently available.

"I get nervous about business cases based on estimated flow-on benefits from large numbers of high-spending conventioneers, as these things have a tendency to be overestimated."

Wellington City Council's proposal for a purpose-built convention centre is out for public consultation.

The public-private partnership proposal includes a 165-room hotel alongside a conference facility specialising in events of up to 1200 people.

The new facility - scheduled to open in mid-2017 - was expected to cost about $100m.

Crampton said the estimated $500m cost of the precinct as a whole was "definitely more than expected".

"What happens when there's no big conference on? These places can end up feeling like dead zones."

Tim Hunter, chief executive of Canterbury and Christchurch Tourism, said the industry had been "waiting a long time" for certainty around the convention centre.

Pre-quake Christchurch had a 25 per cent share of the domestic conference market and a 46 per cent share of the Australian market, he said.

Conferences boosted the tourism industry during the winter months and Christchurch was "the obvious place" to capitalise on large conventions.

It would take about eight hotels to fully service 2000 conference delegates.

"But the more usual size for Christchurch is about 700, so we're talking more like three hotels," he said.

Earthquake Recovery Minister Gerry Brownlee said details were still to be finalised, including what the build programme would be and which hotels could be part of the centre.

"The most important thing is to have a operator model that means the convention centre won't be a burden to the ratepayers of Christchurch," he said.

Ngai Tahu Property chief executive Tony Sewell said the Government would own the centre and the consortium would own the rest.

"What the Government does with it once we've built it is entirely up to them," he said.

The Queenstown Lakes District Council has approved the development of a convention centre and will contribute $32.5m to the project.

Remarkables Park, run by Alastair Porter, is building a multimillion-dollar, 12-metre high centre scheduled to open in Frankton in 2016.

The Press