$350m centre will be 'breakeven' without gaming concessions - Skycity

The proposed new $350 million convention centre for Auckland would be a "breakeven" proposition for Skycity (NZX: SKC) without government concessions on its license, chief executive Nigel Morrison said this morning.

However, Mr Morrison would not say how many extra gaming tables his company had requested. Skycity has also requested an extension to its gaming license.

Prime Minister John Key said Skycity was the only company that offered to fully fund a new convention centre; other contenders had wanted government subsidies.

Ally offside
One of his government's key allies disagrees, however. Maori Party whip Te Ururoa Flavell is pushing a private member's bill that would see the number of gaming machines halved.

Skycity's plan calls for the centre to be built as an extension to its current site, opening 2015.

Mr Key said yesterday that negotiations with SkyCity to build a multi-million dollar international convention centre in Auckland which he said would boost tourism, create jobs, and put New Zealand on the map as a business events destination.

Mr Key and Economic Development Minister David Carter joined Auckland Mayor Len Brown and SkyCity chief executive Nigel Morrison to reveal the plans for the proposed New Zealand International Convention Centre in the heart of the Auckland CBD.

“An international-sized convention centre is essential for New Zealand to tap into the growing market of high value business visitors that we are currently missing out on,” Mr Key says.

“The tourism industry and business sector have been calling for an international-sized centre for years. Now, with SkyCity, we have the opportunity to build one that will encourage more visitors to come to New Zealand and give a valuable boost to our economy.”

SkyCity’s proposal to build a 3500 seat convention centre between Hobson and Nelson Sts was been selected as the best option following an Expression of Interest process.

It is estimated that the proposed centre will provide a $90 million boost to the economy through new spending by additional international visitors. In addition, it is expected that 1000 people will be employed during its construction and, once complete, SkyCity expects around 800 people to be employed directly at the centre.

SkyCity has agreed to pay the full construction costs of the centre -– estimated at $350 million -- and has asked the Government to consider some alterations to gambling regulations and legislation, including a lift in its cap on gaming tables.

Mr Key said the Government had ruled some areas out of discussion and would only proceed with a deal that was good for New Zealanders.

“Any changes to gambling regulations will be subject to a full public submission process,” Mr Key said.