1. Deryck Shaw, APR Consultants Ltd May 24, 2016 May 24, 2016 Rotorua Perspective: Economic Market Outlook 2016 1

2. APR Consultants – Background APR Consultants – Background Rotorua Economy - Recent History Rotorua Economy - Recent History Key drivers and influencers Key drivers and influencers Sources Rotorua Lakes Council, StatsNZ, local media and APR Sources Rotorua Lakes Council, StatsNZ, local media and APR Caveat/interests – resident - governance roles in tourism, health and sport and investments in tourism, commercial and residential property Caveat/interests – resident - governance roles in tourism, health and sport and investments in tourism, commercial and residential property Presentation 2

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4. 4 APR Consultants Ltd 33 year trading history 1983 Started as D.J. Shaw Associates 1985 Operated from offices in central Rotorua 1990 Formation of APR (Architects, Planners, Resource Managers) 1993 Merger with civil and structural engineering services 1990s Opened APR House - Pukaki Street 2005 Operating units of APR separated into separate businesses 2005 Opened The Rotorua Business Hub – Hinemaru Street

5. 5 APR Consultants Ltd 1.Business and organisational planning 2.District and regional economic activity reviews 3.District and regional economic development strategies 4.Economic analyses 5.Economic and business newsletters 6.Economic impact assessments 7.Event management 8.Feasibility studies 9.Industry analyses 10.Market analysis 11.Marketing communications 12.Marketing strategy development and implementation 13.Operational reviews 14.Specialised research projects 15.Strategic planning And many more…..

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7. 7 Source: Infometrics

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9. 9 Source: Statistics NZ data

10. 10 Source: BERL

11. Rotorua business confidence - A survey of 100 businesses and 150 households are undertaken every six months. The last was undertaken in December 2015. - Rotorua general business conditions for the year to December 2016 were expected to increase. 11

12. Rotorua business confidence - Rotorua businesses expected economic activity to increase while householders expected it to remain static. - Most businesses had kept their promotion budgets unchanged over the year Dec 2014 to Dec 2015. - Commercial and residential construction businesses reported an expectation of increased volumes of activity from Dec 2015. - Nationally general business conditions, economic activity, profits, personal income, employment and investment were expected to increase. - On the negative side nationally, unemployment was expected to increase and prices to rise. 12

13. Rotorua employment growth drivers - Tourism (eg, domestic, international, conferences/incentives and events). - Forestry and wood processing (in additional to local there is the servicing of wider region – eg, Taupo, Tokoroa and Kawerau). - Flow-on effects for other industries (eg, dairy, other agriculture). - Service sectors – retail, financial, property services. 13

14. 14 Source: Bayleys Property – Retail

15. 15 Source: Telfer Young

16. Roading investment 16

17. Recent or planned developments A number of recent developments – (eg, new Fairy Springs supermarket, Skyline investments, GHA CBD building) A number of recent developments – (eg, new Fairy Springs supermarket, Skyline investments, GHA CBD building) Pukeroa Oruawhata Group Pukeroa Oruawhata Group CBD developments CBD developments 3 planned new hotels 3 planned new hotels Te Puia developments (new schools and function centre) Te Puia developments (new schools and function centre) Lynmore Junction Entertainment complex Lynmore Junction Entertainment complex Waipa Bike park upgrade Waipa Bike park upgrade 17

18. Pukeroa Oruawhata Trust's lakeside development 18

19. 19 Infrastructure Good water supply and waste water treatment plant – work going on a new disposal field. Well maintained roading network very central. Recently upgraded hospital ($60 m.) Recent new facilities at institute of technology (significant new health and social services buildings). Airport 737 and A320 capable. Further opportunities to strengthen SH network – eg, with volume of heavy transport increased passing lanes on state highway network.

20. 20 Some key influencers going forward House prices – regional demand New (integrated) economic development agency Council rates Tourism - trends, tourism grants available for Rotorua to access Investments in other sectors – forestry and wood processing, dairy, Domestic population growth Air capacity Roading network – increased mobility, upgrades - SH1 Lifestyle – balance – location (less important (ie improvements in connectivity – broadband/transport– more important (access in real time - concentration in cities).

21. 21 Questions?