Holiday parks expected to show $452,000 surplus

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As the Queenstown Lakes District Council moves to lease its four holiday parks to private operators, figures have emerged showing the Queenstown, Arrowtown, Wanaka and Glendhu Bay sites should produce a cash surplus of $452,000 for the council in the 2012-13 year.

The parks are at present run by managers working for the council, but the council is considering up to 10 expressions of interest from private organisations wanting to lease the sites. Council chief executive Adam Feeley said earlier this week he was ''pleasantly surprised'' by the level of interest.

A council decision on what to do with the camping grounds is expected in June or July.

Mr Feeley said in principle, the council was open to ''any commercial arrangement which achieves the goal of removing the financial burden of managing campgrounds from the ratepayers''.

''This could include sale of all of the assets, leasing of those assets, or other commercial arrangements.

''However the land on which the campgrounds sit is reserve and will remain in council ownership.''

The figures provided to the ODT show that together the Queenstown, Arrowtown, Wanaka and Glendhu Bay sites are expected to produce a cash surplus of $452,000 for the council in the 2012-2013 year, after expenses, interest and depreciation.

In 2011-12 the surplus was $371,000 and in 2010-11 $708,000.

During the past five years, the Queenstown Lakeview Holiday Park has been the big earner, delivering revenue of $12.594 million and costing $7.842 million to run - a total surplus of $4.752 million, before interest and depreciation.

However, the size of the Queenstown surplus has been trending downwards - from $1.156 million in 2008-09 to a budgeted $782,000 in the current year.

The trend for both Wanaka and Glendhu Bay is also down.

The Wanaka Lakeview Holiday Park, in its first year back under council management, in 2010-11, produced a surplus of $77,000. This year it is budgeted to produce a surplus of $37,000.

The surplus at the Glendhu Bay Lakeside Holiday Park was $257,000 in 2010-11 against $229,000 budgeted for this year.

The council's biggest investment in its camping sites during the past five years was at Glendhu Bay.

General finance manager Stewart Burns said $840,000 had been spent on plant, equipment and improvements from the previous lessee; $177,000 on the purchase of an online reservation system, new hot water system, replacement vehicles, plant and equipment; $300,000 on a new water supply; $1,800,000 on a new wastewater system; giving a total of $3,117,000.

Mr Burns said the bulk of the spending had been for essential upgrades to water supply and wastewater.

''Although this capex has not increased the valuation directly, if the work was not carried out the camp would have closed and the value would have declined to that of reserve land.''

The valuation figure for holiday parks was for land and buildings but did not include plant and equipment.

The expressions of interest are being evaluated and a preferred proposal is to be presented to the next full meeting of the council, on June 25.

- mark.price@odt.co.nz

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