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The Volvo Ocean Race - A Credit For Our Economy

With the Volvo Ocean Race in 2002 and the America's Cup in 2003, Auckland will reap the huge benefits of hosting the world's two premier global yachting events in the next two years.

As with the America's Cup, the direct economic impacts from the Volvo Ocean Race are expected to be wide-ranging, stimulated by the spending of the syndicates, international visitors, spectators and media who will be covering the event.

Councillor Victoria Carter, Chairperson of Auckland City Council's City Attractions Committee, said that while the Council was faced with increasing its financial support for the event, we should recognise the economic benefit to the region.

"The economic benefit goes beyond the immediate spin off for the hospitality and accommodation sectors with at least three VO-60 boats being built at Cooksons Boats in Auckland, each costing between NZ$ 3.5 and $4million and taking between 15 and 20 people six months to build," said Councillor Carter.

"One of the syndicates, News Corporation, has told us they have been overwhelmed by the quality of the facilities at the Viaduct and are delighted to have access to world class restaurants to assist with the hosting of some major corporate functions ".

"SEB, a Scandinavian bank, has already advised of its intention to erect a marquee valued at $1.5 million as the venue for hosting 60 of its most important clients during the Auckland stopover".

The economic spend of this group alone is estimated to be around $500,000.

Team Tyco syndicate is hosting their Global Chairman's Council while they are based in Auckland. This would bring a further 500 delegates into the city who were not normally associated with yachting.

Councillor Carter said these 500 attendees were expected to spend on average $500 per day, meaning a total spend of $1 .75 million for the week of their visit.

The City Attractions Committee is recommending that a further $1million be set aside in the annual plan for the City's contribution to the running of the event.

"We are working on leveraging the TV rights to the event which will reduce the amount Council needs to contribute to $200,000¡¨, said Councillor Carter.

The Volvo project team has worked up far more accurate budgets than those originally put to Council. The alterations include:
„Y Resource Consents - no allowance, now $80,000
„Y Syndicate base/haulout area - allowed $10,000, now $200,000
„Y Eastern Viaduct rental - no allowance, now $74,000
„Y Te Wero berthage - no allowance, now $42,000
„Y Car parking costs - allowed $5000, now $42,500
„Y Media centre - allowed $70,000, now close to $160,000
„Y With the increases, the contingency has also had to increase.

The original bid, which was submitted prior to the America's Cup, against strong competition from Wellington, Sydney, Fremantle and Melbourne, assumed the bases would be in public ownership and rental was not included.

"The results from the America's Cup have clearly indicated the economic benefit to the City of hosting such events and despite what seems like a large
contribution from Council, we need to keep in mind the anticipated economic benefits of this stopover are in excess of $22 million," said Councillor Carter.

ENDS
For further information please contact:
„h Councillor Victoria Carter, tel (09) 529 1121 or 025 377 018.

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