Fletcher Building's construction unit has won the $NZ477 million ($A446.59m) contract to build SkyCity's national convention centre, five-star hotel and associated infrastructure in Auckland.
Work on the development, which SkyCity says amounts to a $NZ700m total investment in the Auckland economy, is expected to get under way by Christmas, creating 1,000 construction jobs for the term of the 38-month build, and generating an estimated 1,140 jobs once the facilities are complete.
The partnership marks an extension of the relationship between SkyCity and Fletcher, which developed the original SkyCity site, Sky Tower and Grand Hotel.
The two companies have entered a binding commitment and expect to sign actual building work contracts in November.
SkyCity says it has more than $NZ300m of undrawn bank facilities following its recent $NZ125m bond sale, giving it "sufficient headroom" to fund the convention centre and hotel projects.
It plans to update investors on its long-term funding plans once it finalises its Adelaide expansion project, which is estimated to cost about $A300m.
As part of the long-term funding plan, SkyCity is also exploring property-related options including the possible sale of its Federal Street carpark and seeking external investors to fund and ultimately own the hotel. It has appointed JLL to help find investors for the hotel and expects to release an information memorandum in November, it said.
SkyCity Entertainment Group got the contract for the convention centre in exchange for gaming concessions and a licence extension.
Under the deal SkyCity's increased gaming concessions become effective once the building works contract for the convention centre is signed.
It gets 230 new electronic gaming machines, 240 new automated table games and 40 new tables. It will also be able to expand its gaming to include the Federal Street footprint, including the Grand Hotel and convention centre, and gets a gaming venue licence extension to 2048 from 2021.
The company expects to invest $NZ54m to activate the gaming concessions, it said.
SkyCity shares fell 0.8 per cent to $NZ3.91 when NZX trading began on Tuesday morning. Fletcher opened up 0.4 per cent at $NZ7.42.