Wellington City Council votes in favour of selling airport shares

Wellington City Council is proposing to sell their 34% share in the city’s airport to raise money for a disaster investment fund.

Councillors voted to add the sale and the sale of some or all of the council’s ground leases to their proposed 2024-2034 long-term plan.

Council officers will now create a draft budget that will be consulted on with the public before a final vote on the long-term plan will be made by councillors in June next year.

The sale funds would be used to set up a climate-friendly investment fund to help the capital recover from natural disasters.

Withdrawing investment funds to reduce debt wouldn’t be an option in the proposal.

At the end of this financial year the council’s airport share was valued at $278m for accounting purposes, but the council said a market valuation would be required before the proposed sale.

The remaining 66% share is owned by Infratil.

Most councillors were in support of the airport sale proposal.

“It is a very, very risky area that will cost money to defend,” councillor Iona Pannett said about the airport’s location next to Wellington’s south coast.

She said the airport is also carbon-intensive so it's not a good investment from a climate perspective and profit is affected by events like the Covid-19 pandemic.

“I do support swapping one asset for another, especially in a time when climate change is bearing down on us,” Wellington Mayor Tory Whanau said.

Councillor Ray Chung had concerns about the sale price that could be achieved in the current climate and whether other investments would be as profitable as the airport.

Concerns were also raised by councillor Nureddin Abdurahman, who referred to past asset sales as “disasters".

He said the council was able to influence Wellington International Airport on environmental issues, including reducing emissions, through their share.

“The proposal is confused. It lacks mandate and it risks repeating the mistakes of the past…” he said.

“It would make some residents lose even more faith in our council.”

Before recommendations were voted on, Whanau said the council is facing financial challenges with increasing insurance costs or a lack of insurance availability, rising interest rates and climate change.

“We can’t do everything we want immediately,” she said.

“I have pushed for some things as mayor 'cause I felt I could do that.”

Whanau supported investing in upgrading the city’s nightlife district of Courtenay Pl and prioritising small, “grassroots” arts organisations.

“They are vital to a vibrant arts scene.”

Councillors voted to add to the draft plan a range of funding changes from creating two more dog parks in the next 10 years, to stopping $300,000 in funding for home energy assessments from the Sustainability Trust.

A proposal to remove $230m in funding for strengthening projects in Te Ngākau Civic Square and allocate $65m for investigating alternatives, including demolition, has also been added to the draft plan.