Kiwis win, lose at 36th America’s Cup

While winning the America’s Cup was once the reward, now selling it has become a significant benefit. But as was learned by San Francisco in 2013 and Auckland in 2021, the value of the event is hard to estimate. Both governments, after post-event review, overpaid.

A suite of reports released by the Ministry of Business, Innovation and Employment (MBIE) and the Auckland Council show despite being largely successful, the loss is put down to higher than projected public investment, few international visitors, and less challenging teams than was estimated.

The cost benefit analysis identified costs of $744.2 million against benefits of $588.1 million. This is a net cost of 156.1 million. In other words, for every dollar spent, New Zealand only made 79 cents.

The cost-benefit analysis found 38,745 people visited Auckland, but had estimated between 21,497 and 26,275 international tourists and up to 175,000 domestic visitors would attend.

The analysis showed Auckland lost a total of $91.6m when intangibles like social, cultural and environmental costs and benefits were factored in, and lost $145.8m from a purely financial standpoint.

That compared to a New Zealand-wide loss of $156.1m, or $292.7m on a purely financial basis with a benefit-cost ratio of 0.48, or 48 cents back for every dollar spent.

Projections before the Cup was held estimated a benefit-cost ratio for New Zealand of between 0.997 and 1.14.

In 2017, MBIE estimated the America’s Cup would be worth between $600 million and $1 billion to the New Zealand economy from 2018-2021.

Finding positivity was Auckland Unlimited Chief Executive Nick Hill who noted how major events like the America’s Cup help to underwrite the amenities of a city, providing a catalyst for the development of lasting infrastructure and accelerating longer-term projects.

“The America’s Cup has further transformed Viaduct Harbour and Wynyard Quarter, opening up new public spaces, artworks, calm water spaces and infrastructure that will be enjoyed for years to come,” he says.

“The event helped to inject vibrancy, colour and fun across the city, and created a buzz that was felt Auckland-wide.”

Meanwhile, America’s Cup organizer’s report on their own event has described it as a “highly successful global event”, given the challenges of hosting the regatta during a pandemic. America’s Cup Event (ACE) today released its 110 page review, detailing the highlights and challenges behind the scenes.

Source: RNZ, STUFF, Newshub