An evaluation of the 36th America’s Cup shows that, despite being largely successful, the event was significantly impacted by the COVID-19 pandemic and having fewer than forecast challengers.
A suite of reports released today by the Ministry of Business, Innovation and Employment (MBIE) and the Auckland Council group detail the economic benefits of hosting the America’s Cup and key highlights and information on delivering the event.
The reporting includes an independent cost-benefit analysis (CBA) which shows that the overall economic return of the event was lower than forecast, as a result of COVID-19 and associated border closures and restrictions, as well as lower-than-expected number of challengers.
Findings include:
- 36th America’s Cup attracted 38,745 visitors to Auckland, who stayed 377,765 nights around the region.
- 36th America’s Cup created an additional $298.2 million of expenditure in Auckland through the costs of event operations, purchases of tourism goods and services, and other goods and services.
- It was the most watched America’s Cup of all of time with a total global audience of 941 million people and a dedicated audience of 68.2 million viewers across the world, who watched 52 hours of the live broadcast in 236 territories.
- The overall economic return of the event was lower than forecast. 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.
- The cost-benefit analysis (CBA) for Auckland has identified a benefit-cost ratio of 0.85. In other words, 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.
- Legacy infrastructure includes upgraded and expanded superyacht berthages, upgraded wharves, new public spaces and event spaces in Wynyard Quarter, calm water spaces for future water-based events.
- 23 supporting events and activations were held throughout Auckland as part of the Summernova Festival which attracted more than 70,000 unique attendees, separate from the America’s Cup events.
- 94% of attendees were satisfied or very satisfied with their overall AC36 experience.
- 89% of attendees living in Auckland said that hosting AC36 increased their pride in Auckland and 85% thought it made Auckland a more enjoyable place to live.
Over a four-year period, a mammoth multi-agency effort was required to deliver the AC36. Representatives from across the Crown, Auckland Council, and mana whenua worked alongside America’s Cup Event Ltd (ACE), defender Emirates Team New Zealand (ETNZ) and the Challenger of Record (COR) Luna Rossa Prada Pirelli.
To ensure the safe and successful delivery of the 36th America’s Cup, the Auckland Council group invested $215.2 million over four years across operating and capital expenditure*. This included $106.3 million spent on the development of key event infrastructure, and $14.3 million spent on city operations aspects such as transport services, crowd management and security, marketing and promotion and supporting peripheral events through the Summernova Festival.
Auckland Council also brought forward $92 million of already planned works that were set to take place in the city to reduce future disruption and duplication of efforts. The 36th America’s Cup Impact Evaluation by Fresh Info estimates that delivering this infrastructure early will result in future savings of $67 million. This included the removal of the tanks in Wynyard Quarter, upgrades to toilets, new biosecurity signage and cleaning stations, extension of CCTV and other costs such as the relocation of SeaLink and fishing fleet.
Auckland Unlimited Chief Executive Nick Hill says, on behalf of Auckland Council, major events like the America’s Cup often 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. Nearly 280,000 people attended the event at least once – down at the Village, on water, or from one of the great vantage points that our unique landscape provided.
“The challenge was laid down by COVID-19, and Tāmaki Makaurau Auckland responded by putting on a great show as one of the only major events with spectators to happen globally during 2020 and the start of 2021.
“Record numbers of people tuned in from around the world to watch the AC75s fly across the Waitematā, and New Zealanders came out in the tens of thousands to show their support. Those stunning images will remain in people’s minds for years to come and we look forward to welcoming these visitors back when our borders allow.”
The following reports providing a detailed overview are available www.aucklandnz.com/36th-americas-cup:
- Auckland, New Zealand’s Hosting of the 36th America’s Cup, MBIE and Auckland Unlimited, on behalf of Crown and Council agencies, July 2021
- 36th America’s Cup Impact Evaluation, Fresh Info Ltd, June 2021
- 36th America’s Cup Hosts’ Operational Delivery Report, compiled by Auckland Unlimited on behalf of Auckland Council and the Ministry of Business, Innovation and Employment on behalf of the Crown, as Hosts of the 36th America’s Cup, July 2021.
- Wynyard Edge Alliance Value for Money, WEA, December 2020.
Additional reports on the Crown and Council’s Operational Delivery, Leverage and Legacy, Māori Outcomes will be released in August 2021.
Notes for the editor
*A breakdown of Auckland Council’s spend of $215.2 million operational and capital expenditure over four years includes:
Operating and capital expenditure (incl actuals and ‘in kind’ values)
Council projects
$106.3m - Works required to consent, plan, and build or upgraded wharves, bases and water space required for AC36, together with related commercial and base costs (which includes the ‘in kind’ value of the use of the Viaduct Events Centre by ETNZ).
$14.3m - City integration and activation costs including transport services, city operations costs to ensure safe delivery of the event, crowd management and security, marketing and promotion, supporting events and activations as part of the Summernova Festival.
$0.9m - Programme-wide administrative management and support across multiple agencies and years.
$1.7m - Leverage activities such as an environmental and biosecurity programme (along with DOC and MPI), a Māori outcomes programme and business leverage, funded from existing baselines.
$92m - In addition to the event related costs above, $92m was invested in planned works that were brought forward to reduce future disruption and duplication of effort (such as Wynyard Wharf rehabilitation, Hobson Wharf wave panels, utilities and services, superyacht berthing facility, Silo and playground toilets, Bascule Bridge toilets, extension of CCTV, fishing fleet relocation), and other costs such as the Sealink and fishing fleet relocation. Some of these projects were also rescoped to meet AC36 requirements.
The full cost of AC36 infrastructure is included in the cost-benefit analysis, so any offsetting benefits (avoided future costs) need to be estimated and included in the analysis. A line-item analysis of the construction register with Eke Panuku and Wynyard Edge Alliance revealed around $67 million of avoided future costs due to planned projects being brought forward.
Cost-benefit analysis
Fresh Information Limited was contracted by MBIE, on behalf of the Crown, and Auckland Council to evaluate the costs and benefits to Auckland and New Zealand of hosting AC36.
This includes a cost-benefit-analysis (CBA) of the impacts generated by the event. CBA was chosen as the appropriate evaluation framework because any type of cost or benefit can be included if it can be given a monetary value. This allowed social, cultural and environmental impacts to be featured alongside the economic impacts.
This is the first time that MBIE’s cost-benefit framework has been applied to the America’s Cup. It is therefore not valid to compare the results of this evaluation with the pre-event evaluation for AC36, or previous evaluations of America’s Cup events held in New Zealand, because these studies (a) used a different methodology called Economic Impact Assessment and (b) focused primarily on financial outcomes. However, given the high likelihood that comparisons will be made with previous studies despite this caveat, the most valid (but still imperfect) comparator with previous studies is the financial returns.