America's Cup - Auckland venue options come into sharper focus

by Richard Gladwell, Sail-World NZ on 9 Nov 2017 After the 35th America's Cup had been won in Bermuda, Emirates Team New Zealand revealed their planning strategy of 'throwing the ball out as far as we could, and then working out how to reach it'.

The same line was picked up within the Auckland Council as an approach that should be adopted for hosting the 36th America's Cup in Auckland.

With the decision time looming and no obvious options on the horizon, walking the walk is proving to be quite different from talking the talk.

'We need to move at a speed that we are not renowned for - but we believe it is doable,' says Steve Armitage, a general manager with ATEED (Auckland Tourism, Events and Economic Development) the Council owned body responsible for doing what its long-form name states.

Armitage is well aware that the past America's Cup venues worked best when the teams and spectators and media all were in the one place. He calls it an 'aggregated model'.

'We've heard that message quite clearly,' he says, with a grin. Armitage is also part of a committee planning for the America's Cup.

'We know the benefits of an aggregated model and the need to have everything in close proximity from an event delivery perspective, which is our primary interest. That would be our preference and certainly makes it easier. But there are a few decisions that need to be made ahead of that.'

Halsey Street hangup
Armitage won't confirm or deny the suggestion that the contentious Halsey Street extension is the best option to meet the aggregated model test.

'The focus of both Council officials and central government officials is on making sure that we have all the options ready and tested for presentation to the governing body of Auckland Council by the end of the month.'

Armitage explains that they are working toward a governing body meeting on November 23. 'At that meeting, we hope to have a firm position from the politicians about where the host venue will be located. That includes a discussion of the costs of the various options as well.'

'Before the end of the month, the public will have a good idea of what the options are that have been put on the table, and what the relative costs and benefits are for each option.'

At a Council Long-Term Planning meeting on September 5, there were four options under consideration for the America's Cup Village, Bases and Media Centre plus other facilities.

Armitage says that there has been some additions, or rather slightly different iterations to the existing options.

'The team from Panuku Development Auckland have done an incredible job trying to accommodate what Emirates Team New Zealand have outlined in terms of the required footprint. I have been impressed as to the amount of thought and effort that has gone into ensuring that we have looked at every possible option around the Auckland waterfront space.'

Favoured options
'There are obviously a couple of options that will focus attention more strongly. We are obviously very conscious that some would require extension into the water space.'

When asked directly if those two were Halsey Street and Captain Cook Wharf, Armitage would only say that those are the ones that have 'been speculated on, and certainly there has been work on both of those options. But again there are different iterations of those options depending on what sort of legacy benefit the Council and central Government want to derive from hosting the event.'

That raised the issue of whether a legacy use means that if Emirates Team New Zealand lose the America's Cup will the venue be taken for other purposes - as has happened with the original reclamation in the Viaduct Harbour where team bases have been replaced with hotels, office blocks and apartments.

What would happen in 20 years’ time if New Zealand won the America's Cup back for a third time (a not unlikely prospect given that as a Challenger Emirates Team NZ emerged as the top Challenger in 2007, 2013 and 2017)?

'We are very conscious of that,' explains Armitage. 'We are looking at it from the viewpoint that this is long-term maritime event space. We don't just have the America's Cup. We have the Volvo Ocean Race and several different events that require central water space, including the on the water component of waka festival. We do look at this facility as creating a world-class maritime events space.

'We need it looking ahead at some of the other maritime events properties that we are currently considering hosting.

'If we get this right there is an opportunity for Auckland and New Zealand to be viewed as a global leader in terms of hosting on-the-water events.

'From an ATEED perspective that is something we are very keen to secure.'

Armitage adds that they are very conscious of Emirates Team New Zealand wanting to be able to defend multiple America's Cups for a long time into the future.

'Those factors have been contemplated, and it depends on the extent to which the private sector is prepared to engage.'

He adds that involvement of the private sector is essential to reduce the costs to the ratepayer and taxpayer. 'Some of the benefits might not be realised for some time - so the nature of those deals will be complicated but not without precedent.'

Space confirmed
Armitage confirms the basic parameters from Emirates Team New Zealand are for 30,000sq metres for team bases and working on the basis of seven Challengers plus Emirates Team New Zealand. Already three Challenges have been announced, leaving slots for just four more Challengers once entries open in January 2018.

Some teams may need a little more space - that has been fed back to Emirates Team New Zealand, who Armitage says has expressed 'a good level of comfort with what we have put on the table.'

Another factor is in the venue discussions is the very practical one that they have to be conscious of prevailing wind and tide conditions to be able to launch the boats safely. That factor is a downside of the Captain Cook Wharf extension - which can be quite exposed in an easterly breeze.

Responding to the point that six of 19 Council members voted against having the Halsey Street extension even included for consideration in the report back to Council, Armitage says that 'a more informed conversation will take place at the end of this month when we have taken the opportunity to cover each of the options in more detail. The respective pros and cons of each will be able to be debated.'

'Obviously there are some fairly strident views of any further incursion into the harbour', he adds. 'But people are going to have to look at the discussion effectively from the perspective of ‘do we want to host this, or not?’'

Armitage says that ATEED's approach has been that the 2021 America's Cup hosting is a key opportunity to take and 'we all know the benefits that hosting the America's Cup has provided in the past. Not just in terms of the infrastructure that we now enjoy, and the entertainment precinct that has been provided off the back of that.'

Previous investment and return
'There are also the employment opportunities and the life that has been breathed back into the maritime and hospitality sectors. In the last America's Cup, we had more 8,000 full-time employees that were created off the back of hosting those events and some $450million of GDP per America's Cup event coming into the City.'

Those figures are confirmed by MBIE General Manager (Tourism, Regions and Cities) Iain Cossar in a written statement. 'The America’s Cup regattas hosted in New Zealand in 2000 and 2003 had a significant impact on the New Zealand economy generating around half a billion dollars of total value added per regatta, particularly in marine and tourism sectors.'

Infrastructure development was assessed at a one-off cost $120million for the creation of the Viaduct Harbour, and only $8million was invested in the 2003 America's Cup for a total return of over $1billion.

'If you look at what the America's Cup brings to the City in the broader sense, the numbers become very compelling', says Armitage. 'From a political point of view, you can see the jobs it is creating and the focus on Auckland as a destination. As well there is the chance to showcase the innovation that we have in that maritime space - not just on the water, but in the technology that goes into the boats themselves. When you look at the big picture, the business case for the Cup becomes even more compelling.'

Armitage confirmed the dichotomy of hosting the America's Cup is that the Auckland Council is required to front and invest in the infrastructure, but it is central government that reaps the financial return in the various taxes that are paid through employment and GST, plus any import duties.

He says that they are approaching the issue as a partnership between local and central government, but always with a view to also bringing the private sector in to cover a third of the expenditure. 'There is considerable interest from the private sector at this point, but until we have some certainty as to what the options are going to be, we can't pursue those conversations in a meaningful way.'

Long term legacy
Armitage says they are mindful of the asset creep that took place around the original Viaduct Harbour development. After even the 2000 Cup was concluded, the land was sold off to the private sector to the point where in 2017 there was nothing left for the Viaduct Harbour to be used for its original purpose of hosting an America's Cup Regatta.

'We are mindful of that' Armitage repeats. 'We want to have some long-term legacy benefits for the City, and that there is a maritime events space there for some time.'

'We want to make sure that this can be used as public space and events space. We have to have some discussion with the private sector as to the opportunity for them. But until we have landed on the final option and have some certainty around what sort of funding is required, then we are in a holding pattern around involving the private sector in more depth.'

Another of the four options from early September, Wynyard Point also looks unlikely. 'I think that is not in play', Armitage explains. 'The issues are predominantly around the land remediation issues. Unfortunately, that space is not really viable.'

For reasons that Armitage doesn't elaborate, the Westhaven reclamation does not seem to be viable. However, it would seem to be in the viewfinder for superyacht berthage.

Auckland and New Zealand have been through the America's Cup planning process several times. The first in 1988 and again in 1995. In both instances, a Minister for the America's Cup was appointed, and legislation passed to enable fast-tracking of the Consents decision-making process.

'We are being guided by central government,' explains Armitage. 'Obviously we need to move at some pace given that the sheer logistics of getting the required space in place before September next year. The aim is that we will have the consents lodged early in the New Year, then there will be the opportunity for the public to provide some feedback and thoughts on the options.'

'We are trying to ensure that information is being shared between Cabinet and the local governing body at the same time so that all are operating on the same timeline. I am sure there will be some robust conversation as to how the required money will be divvied up and apportioned.'

'Auckland Council is working through their preferred process for any consenting requirements and we will await advice and/or a request from them,' says MBIE's Iain Cossar.

'A departmental cross-government officials group is coordinating activities for the America’s Cup and there will be something similar in place for 2021 – this is how government organises for major events like these, for example, the Lions Series and World Masters Games,' he adds in written statement

New America's Cup Minister confirmed
With the new Coalition Government in start-up mode, David Parker Minister of Economic Development is the lead minister for the America's Cup. The labour Government has always been a strong supporter of Team New Zealand, with former Prime Minister Helen Clark sailing with the team one day in the 2007 America's Cup in Valencia. It was now Speaker Trevor Mallard who signed the Government support agreement locking it into two America's Cup cycles in 2007 and 2013. Mallard was also with the team in Bermuda. Sports fan, Grant Robertson is also expected to lend his support with the joint portfolios of Sport and Finance.

'I don't want to speculate,' says Armitage, 'but if we did wind up with the Halsey St option, then we are going to have some minds focussed quickly on the decisions that will have to be made, and that is not going to happen until the New Year.'

'There is a huge amount of goodwill and effort going in from all the respective parties', Armitage adds. 'I can't speak highly enough of the engagement we have had from central government officials, and Auckland Council agencies . We are all working to get this done. We all believe it is possible. We just need the political willpower to get it over the line.'

In the America's Cup planning exercise, Armitage says Ports of Auckland are an interested observer, and that none of the options should impact on their core business.

One of the primary concerns from an ATEED perspective is the impact on the cruise industry - which again hinges on which option gets the nod.

With cruise ship visits doubling every four years there are clearly some key decisions to be made, both in terms of the growth or otherwise in numbers of ship visits. But Armitage says the trend is for the ships to get larger. 'We are already struggling to meet the demands of the sector because of the sheer size of the ships,' he says. 'We are hoping through this America's Cup planning process that the long-term home of the cruise industry will be confirmed.'

While there are no published economic impact data from Bermuda (due to be released on November 9, 2017), the estimates from Auckland are being used as the best benchmark in the current evaluation.

'Again it depends on how far we want to go in investing in the infrastructure,' Armitage explains. 'That will be the biggest cost we have to absorb. Some modelling is being done to update the economic impact information before they go to the governing body. The Ministry of Business, Industry and Enterprise has seen the numbers from Bermuda,' he adds.

The other leg in the Venue Hosting for the 2021 America's Cup will be how Takapuna Beach will be set up, so shoreside spectators can watch the racing - which will be held close to shore.

Decisions on those facilities are not believed to be part of the current exercise and will wait until the waterfront options are resolved.

According to the Protocol for 36th America's Cup, the hosting in Auckland must be confirmed before August 2018, and the bases need to be ready for occupation 12 months later. Otherwise, the 36th America's Cup will be sailed from an Italian venue.