Casino puts accommodation on site that was meant for new convention centre.

SkyCity is building its new hotel on land surrendered by the taxpayer for the creation of the $402 million convention centre, the Herald can reveal.

It is just one of a number of changes to the deal in which the Government gave the casino company gambling concessions in return for building the centre.

The decision to build a hotel on the former TVNZ property came just three months after the casino company bought the land - the result of three years campaigning for it on the premise it was needed to build the convention centre.

It means SkyCity will now have three major hotels offering 1000 beds within a stone's throw of the convention centre.

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The accommodation boom will add to the boosted income SkyCity will earn from its special law to allow increased gambling which the Government traded for the building of the centre.

Documents show SkyCity told the Government from at least September 2010 onwards it needed the TVNZ land so it could build the best and biggest convention centre.

View a timeline of events in the SkyCity deal.

The need for the land was written into the July 2013 contract with the Government, saying it would build a smaller and less suitable convention centre if TVNZ would not sell it the land. SkyCity bought the land in September 2013.

A spokeswoman for the Ministry of Business, Innovation and Employment said the casino approached officials three months later to negotiate a change to include the hotel.

She said Economic Development Minister Steven Joyce was told just before Christmas and kept briefed until the design was finalised in May. It was announced publicly in August.

SkyCity's "need" to obtain the TVNZ land for its convention centre was such that Prime Minister John Key told Parliament last year the firm needed more land for the design of the centre. "The place it was going to be built, it was quite clear, was TVNZ's land."

The hotel was "just another dodgy part of the SkyCity deal", Green Party co-leader Metiria Turei said today.

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"The New Zealand public have been hoodwinked by SkyCity and National," she said.

"Steven Joyce and SkyCity have misled the public by their insistence that TVNZ's land was essential to build the international convention centre.

"The truth is that SkyCity now gets a prime piece of Auckland CBD real estate with harbour views for a hotel that they wouldn't have been able to purchase without the Government's assistance.

"SkyCity's decision to change their story after the deal was signed shows just how dodgy the deal always was.

"SkyCity will benefit financially from piecing together a new deal over the use of land originally sought for the Convention Centre. Once again the public and the taxpayer have lost out."

The broadcaster had lost land and money in the deal, she said.

"TVNZ never wanted anything to do with the SkyCity deal. It was forced to sell its land by a National Government hell-bent on cutting a deal that will lead to an increase in gambling and social harm," Mrs Turei said.

"SkyCity's extra profits from this deal will come at a high cost for the rest of the community."

A spokeswoman for the Prime Minister said Mr Key was comfortable with the process and the changes proposed.

The change in plan also appears to conflict with a statement Mr Joyce made to Parliament last November.

In response to a written question from the Green Party, Mr Joyce said the contract with SkyCity "prevents the land being used for any other purpose than as a convention centre". He said this week he stood by his answer. "As far as I'm concerned that actually still meets the definition of it being used for the convention centre."

He said other changes would be made to the agreement with SkyCity, which had been enshrined in law last year. With the exception of the gambling concessions, changes could be made between the two parties. He was unable to say whether the casino company would have been able to buy the land if it had wanted it from the outset to build a hotel.

A SkyCity spokesman said the company had planned for a hotel on the southern side "one day" but it became apparent that a more efficient use of the convention centre site was to move the hotel to the northern side.

He said it was always envisaged in the agreement that some design elements might change.

The hotel improved "the overall convention centre proposition".

Q&A
What is the deal?

SkyCity spent years trying to increase its gambling operation without success, because of a tough 2003 law which banned any growth in opportunities to gamble. The Government swapped exceptions to the law for SkyCity building a $402 million convention centre.

Is that a good deal?

It's a contentious deal. Supporters point to the benefit of the centre attracting large conventions, boosting accommodation numbers and 1000 jobs created building and staffing it. Detractors say many more pokie machines and other concessions will increase the degree of social harm from gambling.

Why has it been controversial?

The concessions-for-cash deal is controversial - but so is SkyCity getting the contract. The Prime Minister hatched the plan with its board of directors over dinner, and officials discussed it while the casino company and others competed to win the contract.

When will it be built?

SkyCity expects to file for resource consent before the end of the year. It is unknown as yet whether the public will have the chance to make submissions on the plan. It is meant to be finished by September 2017.