Best of Markets with Madison: Construction and infrastructure

SkyCity chairman Julian Cook takes Markets with Madison inside its troubled International Convention Centre project in Auckland.

Construction is a critical part of New Zealand’s economy and the means to fill our infrastructure deficit but some of our biggest builders are facing issues.

Fletcher Building’s former chief executive Ross Taylor resigned and its former chairman Bruce Hassall and other directors followed him out the door last year, signalling difficulties at the industry’s highest level.

The construction industry has been trying to transform itself after an earlier era that saw it take on too much risk, with bids for projects priced too low.

The $6b Auckland site

One of the country’s largest builds is under way at Auckland International Airport, where $6 billion is being spent to modernise the major tourism gateway.

Chief executive Carrie Hurihanganui took Markets with Madison behind the project in November, explaining how it would add some capacity and ease transit for international and domestic passengers.

The project is not without controversy though - airlines including Air New Zealand and Qantas have criticised the cost which they argued did not markedly increase capacity, and therefore revenue, for their businesses.

Go behind the big project being built by Downer’s Hawkins in this episode.

The cursed project

New Zealand’s International Convention Centre, owned by SkyCity, should have been opened by now, welcoming thousands of cash-rich visitors into Auckland.

But project delays, cost overruns and a devastating fire in 2019 (in that order) meant Fletcher Building was still working to complete it.

“It’s no secret that, historically, there have been significant issues for Fletchers on that site and it’s also no secret that that has cost us a lot of money,” SkyCity chairman Julian Cook told Markets with Madison.

Cook and its new chief executive Jason Wallbridge gave Markets with Madison the first look inside the enormous construction zone in central Auckland at the end of last year.

SkyCity expected to open it by the end of this year.

Fletcher’s fall guy

Markets with Madison discussed the state of the constructor with Ross Taylor before his exit, including how it blew out the cost of building the NZICC for SkyCity.

In this interview he explains what could solve the industry’s critical problems.

Get investment insights from executives and experts on Markets with Madison here on the NZ Herald, on YouTube and wherever you get your podcasts.

Sponsored by CMC Markets.

Disclaimer: The information provided in this programme is of a general nature, and is not intended to be personalised financial advice.

We encourage you to seek appropriate advice from a qualified professional to suit your individual circumstances.

Madison Reidy is the host of the NZ Herald’s investment show Markets with Madison. She joined the Herald in 2022 after working in investment, and has covered business and economics for television and radio broadcasters.