Kauri Lounge: Pictures of secret lounge for VIPs emerge, Jacinda Ardern doesn't want upgrade to be 'significant project'

Newshub has obtained photos from within the private lounge reserved exclusively for top dignitaries located in Auckland International Airport.

They're found in a report outlining the business case for parts of the Kauri Lounge to be refurbished. Upgrade work was initially scheduled to be completed by August but is now unlikely to begin until next year due to supply chain disruptions and other issues.

That delay and a change in "the global economic context" has prompted a rethink of the project's scope to ensure value for money and that only absolutely necessary work is undertaken to meet health and safety standards.

Correspondence provided to Newshub also shows the Minister responsible for Ministerial Services, Jacinda Ardern, saying she believes the lounge is "totally adequate as is", but also acknowledging there are some "legitimate concerns" about building code issues. 

"Beyond that, I'm wary that this shouldn't be a significant project," she said.

The lounge, which is managed by the Department of Internal Affairs' (DIA) Visits and Ceremonial Office (VCO), is found near Auckland Airport's gate 4 and fits about 20 people.

It's a space for VIP guests - including the Governor General, Prime Ministers, Royal Family members and other top-ranking officials - to "have space, calm and privacy" before and after flights and to go through arrival and departure formalities away from the public eye.

Taxpayers fund the lounge to the tune of nearly $400,000 a year, but it's long been shrouded in mystery, with no pictures of it found publicly online. The DIA previously refused a request for photographs or concept art of the lounge as it said they didn't exist.

In early October, Newshub revealed the Government was planning to spend up to $1.2 million upgrading the Kauri Lounge for health and safety reasons and due to "limited investment" over its 25 years in operation.

Original business case

The development of a business case for the potential refurbishment of the area began in April 2021 and was finalised last October. 

Newshub has now obtained the report, which includes three photos showing a bathroom, a shower, and a staff office area. 

They're labelled "areas of concern" as they don't fulfil health and safety requirements and have other issues.

  • It takes eight minutes for hot water to reach the basins in the bathroom and there are frequent toilet blockages. 
  • The unisex shower is raised from the floor due to the drainage system, but this has caused a trip hazard meaning the shower needs to be relocated. 
  • The office for three full-time staff is only a little more than nine square metres, under government standard of between 12 and 16 square metres. 
Bathroom basins in the Kauri Lounge.
Bathroom basins in the Kauri Lounge. Photo credit: Supplier.

The report said the Kauri Lounge has "strategic value because it provides a first impression of New Zealand to visitors", but as well as not meeting health and safety standards, the lounge currently also "does not meet standards expected at other international airport lounges".

The bathroom areas "fail to provide executive level services", the business case identifies, while the "design and décor do not provide an outstanding first impression" and the facilities "do not meet customer needs for comfort, privacy and security" as most fittings are reaching their end of life.

The report said the upgrade would allow DIA to address health and safety concerns, undertake necessary service upgrades, meet legislative and statutory requirements and align the lounge with "customers' expectations and arrangements at other airport lounges", while also showcasing New Zealand products.

Māori design could be incorporated "to provide a distinctly Aotearoa New Zealand welcome for visitors to our country", while the site offers local mana whenua the opportunity to "share some of their stories". Auckland International Airport had offered lower rent for some additional space as part of that initiative, the report said.

The lounge's unisex shower.
The lounge's unisex shower. Photo credit: Supplied.

The business case presented four options, including doing nothing. 

It recommended an option that provided for more leased space, including for a larger office, a "modest" upgrade to the fitout to meet health and safety requirements and present an "outstanding" first impression to visitors, and space and technology to allow virtual meetings to take place. It wasn't the most expensive option.

While pictures of the current "areas of concern" were released to Newshub, floorplans depicting the proposed changes were redacted.

A staff office in the lounge.
A staff office in the lounge. Photo credit: Supplied.

Despite the benefit of providing a "modern, functional and secure work and relaxation area", some risks were identified in the business case, including a "reputational risk".

"There is potential reputational risk to the department should the public perceive the refurbishment is aimed at providing 'luxury' facilities, particularly for New Zealand ministers.

"This could be ameliorated by pointing to health and safety considerations, the need for services upgrades in a building over 40 years old, and the advantages of doing the work when international air travel is largely suspended."

Since the business case was written, the borders have fully reopened. When the refurbishment starts, alternative arrangements will be made for any visiting dignitaries, possibly including using airlines' VIP lounges.

Delays and a rethink

The project was initially scheduled to be completed by August.

However, the DIA told Newshub it's been delayed by "supply chain issues, the introduction of new building requirements and the limited availability of contractors with the appropriate airside security approvals to work on the project". 

The renovation may also end up being different to what was originally decided due to the delay.

"During this time the global economic context changed," the DIA said. 

"As a result, the Department is now taking the opportunity to re-evaluate the project scope, to focus on the minimum work required to meet health and safety and building code obligations, and to reassess the ongoing value for money of further work to upgrade the facility."

Correspondence provided to Newshub under the Official Information Act (OIA) shows Ardern, the Minister responsible for Ministerial Services, being updated on progress.

In one report, dated September 5 - October 7, Ardern was told of the need to revise "the timing and scope" of the project.

She wrote back on October 9, thanking the department for the update. 

"As you may be aware, I think the Kauri Lounge is totally adequate as is, but appreciate it has building code issues (accessibility etc) which are obviously legitimate concerns. Beyond that, I'm wary that this shouldn't be a significant project."

Prime Minister Jacinda Ardern is also the Minister responsible for Ministerial Services.
Prime Minister Jacinda Ardern is also the Minister responsible for Ministerial Services. Photo credit: Getty Images.

VCO later responded saying discovery work is underway "on the nature and extent of the non-discretionary elements of the planned upgrade to confirm the scope of the project".

"We are also re-evaluating the minimum work required to meet Health and Safety and Security obligations (both to staff working onsite and users of the Kauri Lounge), noting the feedback you provided in the last status report."

DIA told Newshub aspects of the business case "will be further refined" following the re-evaluation.

Work is now not expected to begin until at least April next year, after what is described as a historically busy period between January and March.