Call for change in way assets managed
A new company may be set up to manage Christchurch City Council's commercial assets after an independent review found failings with the existing arrangement.
The council's commercial assets, collectively valued at $2.6 billion, are managed through Christchurch City Holdings Ltd (CCHL), but a report by corporate finance advisory firm Cameron Partners suggests that should change.
"CCC's current commercial architecture is likely to lead to sub-optimal [disappointing] outcomes from the rebuild," Cameron Partners say in a 93-page report made public on Friday.
It recommends the council scrap CCHL and replace it with a new commercial entity, CommercialCo, which would manage all the council's commercial assets and activities and have responsibility for the execution of some rebuild projects. It would also help with tourism and economic development.
The new company would be headed by a board made up of the council's chief executive and chief financial officer, two council representatives, and three independent directors.
It would be chaired by an independent appointee.
Cameron Partners said the new set-up would ensure all of the city's commercial assets and activities were aligned to the council's vision and strategy for the rebuild.
The new company would then be ideally placed to function as the council's "rebuild delivery vehicle".
The current set-up did not suit the post-quake environment, Rod Cameron said.
The council's finance committee chairman, Cr Raf Manji, said the new proposal could give the council more control over the assets, as to date it had been "hands off".
Manji said the CommercialCo proposal was an idea to "kick around".
A new structure, like the one proposed, would create "huge efficiencies", he said.
The structure proposed in the Cameron report would allow the council to align its commercial companies' activities with the council's own activities so the resources of both could be used to achieve the council's vision for the city.
CCHL chairman Bruce Irvine said he would work with the council to deliver whatever structure it wanted.