Homelessness is impacting Rotorua's tourism "brand" and the city is one of the areas "struggling the most" as domestic tourism slows, the chair of Rotorua's economic development agency says.
"The homeless situation is detracting from what is an iconic brand," RED chair John McRae says. Photo: Rotorua Daily Post / Ben Fraser
Speaking at a Rotorua Lakes Council operations and monitoring committee meeting on 4 March, Rotorua Economic Development (RED) chair John McRae said while forestry and processing had a "stellar year" and there were good signs in the dairy industry, tourism in Rotorua was "not in a good shape".
He said there had been a slowing of domestic travel and Rotorua and Queenstown were "struggling the most".
RED operates as Destination Rotorua.
McRae said there had been "a bit of a lift when everyone got excited after the lockdown and spent quite a bit of money" in Rotorua, but New Zealanders liked to "go and see many places".
He said as a result Rotorua and Queenstown were not seeing a high enough volume of tourism traffic and the two tourist towns were "struggling the most".
"We've got assets that are built for high volume and yet we're not going to see that high volume probably for up to two years.
"We've lost a lot of infrastructure to get people here ... the booking systems, the travel systems ... so that could be another six months to a year before we start getting volume.
"We are now seeing some of our bigger brands [that] have had strong balance sheets now starting to come under pressure. The mum and dad businesses ... are stretched mentally and physically to just try and keep their organisations going."
McRae, a chartered accountant with Deloitte, said personally didn't think the emphasis should be on volume in the future but on "high value and lower volume".
"On the whole, the [Rotorua] economy's doing pretty well because of our primary sector.
"We need to play to our strengths.
"[RED is] considering a lot about those areas that are doing well and how we accentuate and ... accelerate what they're doing ... as well as try to help the tourism sector rethink what the product is."
He said the property development sector was "constipated".
"There needs to be a lot of help there to get things moving, literally."
Councillor Peter Bentley asked if there had been an impact on tourism from Rotorua's homelessness problem.
McRae said he'd "like to say something other than yes".
"Of course it does.
"From a business point of view it is detracting from our product. We've spent 100 years building Rotorua as a destination ... the homeless situation is detracting from what is an iconic brand and depreciating that brand, quite frankly."
Bruce Thomasen said Rotorua was fortunate to be so close to Auckland which he called a "driver" of domestic tourism. Photo: Rotorua Daily Post / Stephen Parker
Speaking to Local Democracy Reporting on Thursday, Rotorua Treewalk director Bruce Thomasen said domestic tourism had "softened" and many tourism operators were making most of their business on weekend and school holiday "spikes".
However, Thomasen said Rotorua was in a relatively fortunate geographical position to weather the storm, being so close to Auckland, which he called a "driver" of domestic tourism.
He said reports on Thursday of a possible trans-Tasman bubble by the end of April was "really good news" as the Australian tourist market posed a good opportunity while all other markets were closed.
Thomasen said homelessness was "an issue for the whole country" not just Rotorua and while it "absolutely" impacted on the perception of the city it had another effect: reduced accommodation capacity due to emergency housing in motels.
"When we get demand again and we don't have capacity, that's a lost opportunity."
On Monday, Rotorua MP Todd McClay held a public meeting to discuss what he termed as "homelessness, social disorder and crime", which was attended by about 350 people.
Local Democracy Reporting is a public interest news service supported by RNZ, the News Publishers' Association and NZ On Air.
