Rugby stadiums are sold as an economic asset – but NZ needs to ask if they’re really worth it
Retrieved on:
Friday, April 19, 2024
But is a new stadium really value for money for Auckland ratepayers?
Key Points:
- But is a new stadium really value for money for Auckland ratepayers?
- Large stadiums are sold as an economic boon for cities.
- These stadiums are often opposed by sections of the communities asked to pay for them.
For the love of the game
- When the game was still amateur, it was expected to build and maintain its own stadiums.
- For example, Carisbrook in Dunedin was initially built by the Otago Rugby Football Union, while Eden Park was built by various Auckland sports associations.
- Taxpayers and ratepayers started paying significant amounts for construction of rugby and “multi-use” stadiums.
- Ed Sheeran cited the shape of the stadium – rectangular rather than oval – as a reason for skipping the city on his 2023 world tour.
Costs and benefits
- Whether it is there from the outset or creeps in later, the case for funding from the community is usually based on “economic impact analysis”.
- This figure is then increased via what is known as an “economic impact multiplier” to create a topline figure in support of the stadiums.
- And events may have been held in the community at existing venues before the new stadium was built.
Borrowing and interest costs
- Te Kaha, which cost NZ$683 million to build, was promoted as having an annual $50 million positive economic for the region once it opened.
- But at the same time, Christchurch ratepayers are expected to pay the majority of the construction costs ($453m), while the crown invested $220m.
- A significant part of the council investment was borrowed, meaning ratepayers will also be paying for the interest on this debt.
Robert Hamlin does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.