REVIEW REPORT 3rd QUARTER 2017/18: January March 2018 QUARTERLY - - PowerPoint PPT Presentation

CCO – Rotorua Economic Development Ltd

QUARTERLY REVIEW REPORT

3rd QUARTER 2017/18: January – March 2018

QUARTERLY HIGHLIGHTS

• Rotorua Insights Dashboard, live on RotoruaNZ.com

– Featuring information for those looking to relocate to Rotorua e.g. jobs board, housing costs, NCEA pass rates

• Famously Rotorua Instagram Trail map completed and also installed at Fenton Street iSITE

@rotoruanz monitoring impact

• Working collaboratively with RLC on Big Moves projects, including insights, data, and

commercial market feedback

• Attracting Talent to Rotorua – production of “a locals perspective” video clips (4) on the

benefits of living in Rotorua available on youtube, Linkedin and Rotoruanz.com to be used with relocation guide under development and the Insights Dashboard

• Famously Rotorua 3 videos produced featuring, young couple, older couple and family

released on youtube, facebook and various “pre-roll video” on various digital platforms

• Crankworx Media Centre hosts over 125 Domestic and International Media
• Facilitated site visits for potential investors looking at co-investment opportunities and

provision of economic and trend analysis for region

• Supporting potential investors with connections to developers and potential sites and

working with central government and local government partners to showcase the region and provide information to potential business and investors

• 1st round of Accelerate participants Graduate
• Research into opportunities in the high value over volume visitor sector 1st phase completed

FINANCIAL MANAGEMENT as at 31st March 2018

Operating Budget Comments

• Rotorua Economic Development (RED) is currently trading at a net surplus of $590k which presents a favourable

variance to the budget of $493k as at the end of March 2018. Year end forecast is a surplus of $129K.

• This financial year there has been ongoing focus on delivery within available funding. During the nine months to

March major variances include reduced trading revenue, reduced sundry revenue which have been offset by lower costs compared to budget.

• There has been a significant drive to ensure that recruitment for roles are sustainable and reflect the needs and

delivery of the business which has resulted in a variance between budgeted salary allocation and the filling of positions.

• Improved performance of visitor industry during the February / March period saw a decision taken to push out

campaign and market initiatives to the shoulder and low season.

• The majority of marketing spend falls in the shoulder and low season as a result the majority of spend is April,

May, June for the purposes of the 2017/2018.

• Non Financial performance measures

On track 11, off track 3, achieved 6, no data available 6 (as per provided report)

$000 20117/18 Budget 2017/18 YTD Actual % Variance Income 5,827 5,228

• 10%

Direct Expenditure 5,109 4,054 21% Total Overheads 621 584 6% Total 97 590 510%

QUARTERLY ECONOMIC INDICATORS

• Rotorua’s economy continues to perform well. GDP growth was at 4.0% over the year to March 2018, well

above New Zealand at 2.7% pa.

• The average house price in Rotorua was up 7.1% in March 2018 compared to previous year, outperforming

Bay of Plenty region growth of 3.1%, but less than New Zealand at 9.5%.

• The unemployment rate in Rotorua District was 6.2% in March 2018, a slight decrease from last year but

remains higher than national figure of 4.6%.

• Marketview data shows electronic card retail spending increased in Rotorua District by 5.6% in year to

March 2018, higher than national growth of 4.5%.

• Rotorua District’s revised total dairy payout for the 2017/18 season is expected to be $335m, a $22m

increase on 2016/17, as Fonterra’s Global Dairy Trade auction in April saw prices increase by 2.7%.

• Total log prices have increased by 11% in year to March 2018, largely driven by the domestic market

(+18%).

• Beef prices are up on last year, estimated at 7% growth (c per kg) for 2017/18 season across all grades.
• Concern over the impact of Mico Plasma Bovis.
• Wool price changes vary – fine wool has seen consistent growth over recent seasons, and estimated at

25% growth on last year. Conversely, coarse wool price is trending negatively, estimated to be down 20%

• n LY.

QUARTERLY TOURISM SNAPSHOT

• The tourism industry is the biggest driver of economic growth and employment in the Rotorua District and

indicators of tourism have all ticked up over the past year.

• Guest nights in commercial accommodation in the Rotorua District were up 6.7% in year to March 2018,

compared to an increase of 3.9% for New Zealand. Private accommodation continues to see massive growth, Airbnb guest nights were up 67% for summer 2017/18.

• Attractions (+4.1%) and activities (+3%) driven by international and domestic visitors, although domestic

visitation to activities was down 2.7% on LY.

• Tourism spending in the Rotorua District continues to grow, increasing by 9% in the year to March 2018,

which equates to approximately $823m total tourism expenditure.

• Domestic tourism in Rotorua spend grew by 9.2%, largely driven by visitors from Auckland and Waikato.

This was ahead of national growth of 6.9% in the year to March 2018.

• Rotorua’s international tourism spend grew by 8.8% to year ending March 2018, lagging national growth
• f 13%. Australia, China and the USA remain the largest international tourism markets for Rotorua.
• Rotorua’s most valuable international visitors are from Canada, the Americas, Japan and Europe, having

higher expenditure per overnight arrival on accommodation, recreation and dining.

• Visitors from China and Korea typically have a shorter duration of stay, and whilst they have a high total

spend the majority is in the retail/other sector.

NEW ZEALAND TOURISM FORECASTS 2018-2024 – KEY MESSAGES

Visitor arrivals forecast to reach 5.1 million by 2024

Source: MBIE, NZ Tourism Forecasts

International spend is forecast to reach nearly $15 billion by 2024

NEW ZEALAND TOURISM FORECASTS 2018-2024 – KEY MESSAGES

China to overtake Australia as the largest market by spend Australia will remain the largest source of visitor arrivals Other Asian markets will continue to grow

Source: MBIE, NZ Tourism Forecasts

KEY STRATEGIC ACTIONS AND UPDATES Destination Management – Wayfinding

Rotorua Instagram trail map completed and installed at Fenton Street i-SITE @RotoruaNZ monitoring impact; early indications show an increase in followers and posts to various locations

KEY STRATEGIC ACTIONS AND UPDATES

KEY STRATEGIC ACTIONS AND UPDATES

• Destination Management - High Value Visitors
• Major research project to undertake a comprehensive analysis of the

current service offering to this market within Rotorua

• The luxury travel market is projected to be the fastest growing segment of

the travel market worldwide^

• The average high wealth visitor will spend $50,000 - $1m on a 14 day

holiday to New Zealand

• Tourism New Zealand has been working hard on the luxury travel market

for the past 4 years, with real success. Over 300 specialist high net worth agents have voted New Zealand their “most preferred destination”

• Extensive upgrades to existing facilities (e.g. Te Puia, Skyline), new

experiences (e.g. Canopy Tours, Rotorua Tree Walk), and ambitious council-led initiatives to upgrade infrastructure (e.g. lake front development) are examples that Rotorua delivers on an immersive and unique New Zealand experience high value visitors are seeking

• However the key opportunity for Rotorua is our current lack of high-end

accommodation to cater for the luxury travel market

ROTORUA IS AN ATTRACTIVE DESTINATION FOR LUXURY MARKETS, BUT LACKS IN SUITABLE ACCOMMODATION

THE OPPORTUNITY IN THE LUXURY ACCOMMODATION SEGMENT FOR ROTORUA IS CLEAR