Fast-food giant causes lease pains for Auckland Hospital

By MARTIN JOHNSTON

Plans to attract shops to the new Auckland City Hospital may be hampered by a deal with hamburger giant McDonald's that excludes other fast-food shops.

McDonald's opened a restaurant in the foyer of the nearby Starship children's hospital in 1997.

The Heart Foundation opposes the presence of McDonald's, saying it sends conflicting messages to the public, even though the restaurant offers fruit and cereals as well as the usual menu.

Starship is New Zealand's only hospital with a McDonald's, but many overseas hospitals have one.

A clause in the restaurant chain's lease with the Auckland District Health Board prevents more fast-food shops from setting up at the board's Grafton site, home to two hospitals and other health facilities.

The lease runs until about 2012.

The board is checking out which shops it may want to attract to the 710-bed hospital being built at the site and due to open next October. This could include a food hall, pharmacies, gift shops, florists and bookstores.

Some board members have suggested including a private accident and medical clinic to take patients who do not really need a hospital emergency department.

Officials have told the board that the McDonald's lease is a key hurdle, as it has "particularly onerous exclusivity clauses".

General manager of planning Nigel Murray said the board was yet to have formal negotiations with McDonald's, but the contract - which did not define "fast food" - might prevent the setting up of new cafes.

"We have to work out how they interpret the exclusivity clause. I'm optimistic there will be no issues. We have a good working relationship with them."

When a board member last week asked about buying McDonald's out of the lease, board chief executive Graeme Edmond warned him: "Don't go there."

Yesterday, Dr Murray said it would be expensive.

The board was committed to the McDonald's contract, he said, but had no plans for more fast-food outlets.

McDonald's spokesman Liam Jeory declined to comment on the contract, as the formal talks had yet to be held.