Covid, lack of challengers saw America's Cup record lower-than-expected return

Source: 1News

Cost-benefit analysis (CBA) shows New Zealand got back just 48 cents for every dollar spent on the 36th America's Cup.

Sir Stephen Tindall celebrates after Team NZ defends the America's Cup.

A number of reports done by the Ministry of Business, Innovation and Employment and Auckland Council have been released today, detailing the economic benefits of hosting the cup.

It shows the event was significantly impacted by Covid-19, and by having fewer than forecast challengers.

Team New Zealand retained the Auld Mug after defeating Luna Rossa in the America's Cup series in March.

CBA identified costs of $744.2m and benefits of $588.2m for New Zealand, a net cost of $156.1m and a benefit-cost ratio of 0.79 for both financial and non-financial impacts.

"When considering financial returns only, New Zealand got 48 cents back for every dollar put in."

Cost-benefit analysis for Auckland shows a ratio of .85, meaning for every dollar put in, Auckland got 85 cents back.

"When considering financial returns only, Auckland got 72 cents back for every dollar put in. The CBA considers social, environmental and cultural factors as well as financial," a release from Auckland Unlimited, an Auckland Council organisation, said.

Auckland Council group invested $215.2m over four years, including $106m on developing key infrastructure, and $14m on city operations such as transport and security, marketing and festivals.

It also brought forward $92m of already planned works.

“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,” Auckland Unlimited chief executive Nick Hill said.

The regatta helped attract 38,754 visitors to Auckland, and 279,280 people attended the cup village or watched a race live from a boat or land-based viewing area. 

It attracted only three challengers - Luna Rossa, Team UK and American Magic - when early projections were based on six to 10 teams.

The net benefits for Auckland and New Zealand are lower than expected because of having fewer challengers, the impact of the pandemic on international visitors, and higher-than-projected public investment. 

"The overall economic return of the event was lower than forecast," the report said. "This was due to the significant impacts of Covid-19, restricting international visitors, media and superyachts as well as public race days in the race village. This was further impacted by a lower-than-expected number of challengers and the costs being higher than initially forecast."

A total of $348.4m was spend on America's Cup-related capital and operating expenditure over four years by the Crown (133.2m) and Auckland Council (215.2m).

Team New Zealand boss Grant Dalton said the organisation was pleased with the result given the challenges.

"Certainly the world changed significantly since we won the America’s Cup in 2017, and essentially the entire organisation of the event was flipped on its head one year out so even just the fact we managed to achieve putting on a successful major global sporting event in Auckland, while the majority of the world was locked down, was a huge achievement.”

Last month, Team New Zealand declined a combined offer from the Government and Auckland Council to help host the next America's Cup in Auckland, and is looking at overseas options. 

Dalton told 1 NEWS today discussions over the next venue were ongoing.