9 Jun 2017

Council's asking price scuppered housing project - developer

12:05 pm on 9 June 2017

An Auckland community housing developer is furious a plan to build hundreds of houses in Manukau has collapsed at the last minute after the council rejected its offer.

A state house in Northcote/

Photo: RNZ / Claire Eastham-Farrelly

The New Zealand Housing Foundation said it was about to start the $140 million project when the council rejected its offer for the land.

The Foundation's Paul Gilberd, said the council wanted too much money which would have made it impossible to build affordable houses.

It meant nine months 'work and tens of thousands of dollars had been wasted, he said.

The foundation was approached by the council's property arm Panuku Development last year after its success with the Waimahia Inlet project.

The 290-home development in south Auckland is a partnership with the iwi-based Tamaki Collective, providing a mix of social, rental and cheap homes.

"They came to us and they said, 'hey we really like what you've done at Waimahia, we acknowledge its been a tremendous success. Would you be prepared to work with us as the landowner on a new property in the centre of Manukau city?'," Mr Gilberd said.

After getting community backing for its plan to regenerate the land and help transform a long-neglected area, the foundation started contract negotiations with Panuku and made an offer for the land.

But just before earthworks were due to start Panuku pulled out, Mr Gilberd said.

"That whole process has collapsed and is off the table as of Wednesday last week," he said.

Mr Gilberd said he was "gutted" by the decision and he thought the price was the sticking point.

The foundation offered $13 million for the land but Panuku wanted $24m.

The foundation could not develop a project that would include more than 100 affordable houses if it had to pay any more for the land, he said.

"They've come to us and asked us to deliver a community outcome. If you're building affordable housing the land is what its worth as affordable housing. If you're going to build a casino and a hotel, the land is worth more," Mr Gilberd said.

"What I think we're realising as community housing providers and builders and planners and concerned New Zealand citizens is that actually we're going to have to solve the problem because we seemingly can't rely on the Crown, or in Auckland we can't rely on the council to seriously roll up their sleeves to be a part of the solution," Mr Gilberd said.

Panuku refused to speak to RNZ.

But in a statement its director of development, Allan Young, said Panuku was leading central Manaukau's transformation and it wanted to achieve the best outcomes for local communities.

"Panuku is currently in the midst of a commercial process for this particular site and so unfortunately we are unable to offer any further information at this time," Mr Young said.

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