Tainui Group Holdings completed Amohia Ake, the new regional offices for ACC in Hamilton - one of numerous projects the ever-growing business has worked on. Photo / ACC
Iwi-owned commercial entities have outperformed some of New Zealand’s largest listed companies, according to a new report by ANZ.
In March, a Māori economy report authored by the Ministry of Business, Innovation and Employment and Te Puni Kōkiri showed the Māori economic contribution to the New Zealand economy had grown from $17 billion in 2018 to $32b in 2023.
Now, ANZ’s annual Te Tirohanga Whānui - Iwi Investment Insights report - has further highlighted the ever-growing Māori economy.
Its data shows that iwi and hapū-owned entities have emerged from the economic downturn in good shape, performing better, on a return on assets basis, than some of the country’s largest listed companies in the 2023-2024 financial year (companies defined by NZX as having assets greater than $900m).
Tainui - who settled land grievances with the Government in 1995 for $170m - are among the strong performers, having a balance sheet of $1.9b.
Tuku Morgan, chair of Waikato-Tainui’s Te Arataura, the executive entity of the iwi, said Tainui’s current financial position had taken the iwi 30 years and the ANZ survey shows they are on the right track.
Waikato-Tainui has 68 marae. These marae are spread across 33 hapū (sub-tribes) within the iwi (tribe).
In the past year, its strong financial position had allowed it to distribute around $56m among its various marae; with Morgan saying “the marae is at the heart and the foundation of our tribe”.
“That is where our power base is. That’s where we build the cultural integrity and fortify the up and coming generations, who can build on that.”
Morgan said the ANZ survey reinforced their financial direction and application.
In April, Tainui Group Holdings (TGH) - the financial arm of the Iwi - and global alternative asset manager Brookfield Asset Management (Brookfield) announced they had entered into a long-term joint venture (JV) to supercharge the development of Ruakura Superhub in Hamilton.
The JV will initially purchase four existing industrial/logistics buildings on long-term ground leases at Ruakura Superhub, which are tenanted by Kmart, Big Chill, Refrigafreighters and PBT Express.
They intend to develop out a further 70ha of logistics development assets at the intermodal logistics precinct with a forecast completion value of more than $1b.
Further investment opportunities that present strong risk-adjusted returns would be considered.
Since the announcement, Tainui has met with officials from Samsung and Hyundai. Other prominent offshore potential investors had also been in contact.
“It has taken Tainui a long time to get to where we are and we are pretty satisfied on where we are,” Morgan said.
“Over the years there have been missteps but without a strong economic base, iwi will be spectators in a economy and we are a very important part of the growth of this nation.”
Morgan said the Brookfield deal was “hugely important because it gives us some finality of the inland port” and it augured well for Tainui’s future.
“This has never been about a sprint but our long-term strategy and intergenerational approach to building our capability and providing an economic base.”
Morgan said the iwi were also looking to devolve more funds to local marae to allow them to develop their own commercial incentives.
“For the next five years, we are moving to devolve greater levels of funds to enable clusters of marae to engage in their own significant commercial arrangements.”
ANZ’s Te Tirohanga Whānui reported 2023-24 saw a modest growth in asset values across iwi surveyed– the median being 4.1%.
Most noticeable was the changing mix of assets with cash and managed funds being gradually reallocated into direct investments, co-investments and private equity-style ventures.
This shift in asset allocation appears to be having an impact. Operating earnings are increasing, and – despite a general trend of increasing expenses – these earnings are growing faster than asset values.
This has driven the median operating return on assets up for the second straight year – to 4%.
“To maintain growth iwi will continue to search for the right mix of income and growth assets to invest in, contain costs, and effectively leverage their revenues streams to build diversified, resilient investment portfolios,” ANZ’s New Zealand head of Māori Relationships David Harrison told the Herald.
“In terms of iwi, what sets them apart from many companies is the diversification many have across their asset bases; in some cases having cash, managed funds, land and property, fisheries and agriculture, as well as private equity style investments.
“In addition, starting from a position of low levels of debt, a number of iwi have been able to accelerate their growth by borrowing to help fund investments.”
ANZ’s annual Te Tirohanga Whānui - Iwi Investment Insights report is a long-running collaborative research project, now with 10 years of data, involving 38 iwi/hapū entities managing treaty settlement assets, designed to help guide and inform iwi investment decisionmakers.
“We’ve seen their various strategies of diversification evolve and be implemented. And it’s great to see the continuing strength and resilience of iwi through challenging times,” Harrison said.
“Iwi/hapū are significant contributors to the Māori economy and Aotearoa’s economic growth agenda and this growth is part of a much wider trend we’re seeing as Te Ōhanga Māori continues to develop rapidly.”
“When the Māori economy grows, it strengthens the whole New Zealand economy – laying the groundwork for long-term sustainability and shared prosperity.“
Joseph Los’e joined NZME in 2022 as Kaupapa Māori Editor. Los’e was a chief reporter, news director at the Sunday News newspaper covering crime, justice and sport. He was also editor of the NZ Truth and prior to joining NZME worked for urban Māori organisation Whānau Waipareira.