SkyCity Meets Guidance Despite Strong Kiwi Dollar; To Lose Crown as New Zealand’s Tallest Structure With Planned 52-Level Tower in Auckland CBD
By Vittorio Hernandez | February 13, 2014 9:33 AM EST
The NZX 50 Index added 21.089 points on Wednesday, equivalent to 0.4 per cent, bringing it to 4869.972. The rise in New Zealand stocks came after the SkyCity Entertainment Group met guidance for its first-half earnings despite the strong kiwi dollar.
Shares of SkyCity, a landmark in Auckland, went up 1.4 per cent to $3.65 after the company reported a net profit of $66.4 million which is in line with its guidance of $65 million to $68 million. However, when compared to 12 months ago, the net profit is lower by about 8 per cent.
It explained the lower profit to the strong Kiwi currency and slower consumer spending. David Price, a broker at Forsyth Barr, pointed out that while SkyCity got a fairly good shellacking due to its guidance, it wasn't as bad as anticipated.
"What SkyCity alluded to today, which will be a theme throughout reporting season, was the strength of the Kiwi against the Aussie dollar," he said, quoted by the New Zealand Herald.
SkyCity has a casino, entertainment centre, restaurants, a revolving tower and a viewing deck that offers 360-degree view of the skyline of Auckland, the country's financial centre. It is also a favourite place for bungee jumps and sky walks.
However, SkyCity may lose its premier status as the tallest structure in New Zealand since Auckland is planning to build another entertainment hub with cinemas and other amenities that would soon become New Zealand's tallest tower.
The planned 52-storey, 209-metre skyscraper would cost $350 million and would be built at the commercial business district at a lot that used to be the site of the Royal International Hotel until it was demolished in the 1980s. The lot is now owned by businessman Furu Ding, a multimillionaire from Shanghai. His New Development Group will construct the tower to be called NDG Auckland Centre.
The lot is bound by Elliot, Albert and Victoria Streets, and currently serves as a car park and bungee jump point.
Before the 1987 stock market crash, Acadia Corporation, a new property developer, planned to build a $120 million, 32-story office tower on the lot slated for opening in 1990, but Acadia abandoned the plan eventually.
According to Auckland Mayor Len Brown's statement, the 52-level tower would also offer a luxurious hotel rumoured to be a Ritz Carlton, offering 302 rooms.
Six levels would be dedicated as car park, helping alleviate the lack of parking space in the city. On the eighth level, there would be retail outlets.
"The design will also enhance the urban space and connectivity with a footpath link, internal pedestrian circulation and arcade plaza, a plaza to Albert St and a podium garden area," the statement said.
While the project already has a resource consent from the Auckland Council, NDG Auckland Centre's reign as the tallest tower in New Zealand would soon be challenged by the planned 328-metre Sky Tower beside it. However, the latter's building consent is still pending before the city council.
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