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Convention Centre Proposal. Introduction. Approach made by consortium P artnership to deliver: - 5 star Hilton hotel (165 rooms) + purpose built ‘city scale’ conference centre - Council lease convention centre for 20 years - Strategically located opposite Te Papa. Strategic Context. - PowerPoint PPT Presentation
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Convention Centre Proposal
Introduction
• Approach made by consortium• Partnership to deliver:
- 5 star Hilton hotel (165 rooms) + purpose built ‘city scale’ conference centre- Council lease convention centre for 20 years- Strategically located opposite Te Papa
Strategic Context
• Conventions are important to Wellington. Per year:- $146m in expenditure- $76m in GDP - supports over 1,000 FTE’s.
• Government investment to increase NZ market share- $34m over four years
• Current civic facilities not always competitive in the market- limited functionality- capacity issues- aging facilities
• More market competition from 2018- Auckland, Christchurch, Queenstown
• Need for improvement known / outlined in ‘Big 8 Ideas’ adopted earlier this year
Two Strategic Options
What the market is doing
Convention proposal structure and terms
Developer
Developer
Development agreement and lease
Lease Pro-rata rates and insuranceTerm 20 years + right of renewal in year 15Annual rent reviews at CPI
Sub-lease
Net Operating Profits After building costs and Operating Co incentivesAfter any operating loss clawbacks
Management Agreement Licence fees based on revenueIncentives based on operating profits
WCC
WCC
Operating CompanyOperating Company
Hilton
Hilton
Cost and return on investment
Other Benefits
• Construction Benefits- Circa $50m to the regional economy- About 300 FTEs during construction
• Hilton presence in Wellington- Most recognised hotel brand in world- Number 1 hotel in Asia pacific past 5 years- Loyalty programme 40 million members worldwide- Pre-eminent and most visited brand website- Strong corporate responsibility standards
• Support for the sector- retail sector- transportation- hospitality sector- acoomodation providers
Other Benefits - secondary investment
Who benefits and who pays
• To be tested through consultation• Subject to Financial Strategy and Revenue & Financing Policy LTP process
Questions
Advisors