Auckland Airport’s post-tax returns for its shopping centres and car parking remain higher than others around the country, but are materially lower than they were during the 2010s, say analysts at Forsyth Barr.
Detailed analysis of AKL, titled- Cleared for Lower Returns shows while ‘it is still the most attractive shopping mall in New Zealand’ it generates lower profits from lower margins than it did pre C-19. Retail passenger spend rates have declined materially in real terms over the past 15 years, while operating costs to support retail have increased.
Over the past 15 years operating expenditure has increased at a compound annual growth rate of +11.3%, well above the consumer price index over the same period, the analysts say.
Car parking returns have been depressed by the significant investment in the Transport Hub. The project was due to cost $300m, yet Forsyth Barr analysis implies it cost significantly more than this. AKL spent $475m on car parking during three years to 2025, the majority of which related to the Transport Hub.
Return on invested capital is around 6.7% in the latest financial year, which contrasts with estimates that car parking returns were around 40% in their 2010s peak.
“As with aeronautical returns, we expect commercial returns to increase over time, but not back to the levels generated during the 2010s,” adds the report.
