The answer to the question, what property ought to be in public ownership and what is better owned privately is close to the heart of good economic policy. It is a question many Aucklanders are asking when they read that a private developer is buying up the region's boating marinas with plans for apartment buildings and waterfront shops and cafes in place of car parking.
The developer, Simon Herbert, through his company Empire Capital, already owns Bayswater and Pine Harbour marinas and is said to be poised to acquire land around Hobsonville Marina which Auckland Council's asset management agency, Panuku Development Auckland, will offer for sale. Panuku's job is to go where politicians fear to tread, selling council-owned property where it believes the city would be better off if the asset was in the private sector.
Asset sales are often presented to the public as a financial necessity. Auckland Council is at the limit of its permitted borrowing and needs to sell superfluous assets as well as find new sources of revenue, such as a fuel tax, to provide the infrastructure for the city's growth. While all of that is true, it is not the whole rationale. Private investment often provides a city with developments it would have had from the public purse. Auckland's Sky Tower is the most conspicuous example.
The city's harbours and coastline are undoubtedly its greatest natural asset. Free and easy public access to that asset is essential in any development of the waterfront. The council's design of the Viaduct Harbour development has demonstrated how well public access can be preserved in a residential development close to the water. Gulf Harbour on Whangaparāoa is another fine example. So long as the council retains regulatory oversight of private marina developments there is every reason to expect similar quality from Herbert's projects.
The Auckland Marina Users' Association is naturally worried that with three marinas in his empire, Herbert will be well on the way to a monopoly. That is a risk the council would have in mind. But apart from Westhaven, all Auckland's marinas have been built and run in the private sector. There appears to be enough competition to keep mooring charges from rising too much.
