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Hamilton council races to get special housing area over the line

Friday 26th April 2019

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Hamilton City Council is rushing to get special housing designation for a planned property development before the government ditches the fast-tracked process. 

An extraordinary council meeting on Monday will consider recommending that Associate Housing Minister Jenny Salesa prescribe an enlarged Quentin Dr development as a special housing area, with a view to building 111 new homes.

That is almost twice the size of the development the council proposed in October. The land, south-west of Lake Rotoroa, is currently zoned industrial and adjoins a residential area. 

Hamilton was one of several local bodies that signed accords with the previous government to use the housing zones to accelerate development. It finished gauging interest for a second round of special housing zones in February. 

But the current Labour-led coalition last month decided to ditch the policy, which won't be renewed when the legislation expires in September. That has put the acid on the council, which needs to apply to the Ministry of Housing and Urban Development by April 30. Even then the agency can't guarantee a designation by Sept. 16 when the legislation rolls off. 

The Hamilton accord sought to deliver more than 1,300 new dwellings annually between 2017 and 2019. Under an update to that accord, developers had to show that 10 percent of their yield would be sold at 90 percent of the city's average house value - $580,285 in QV's latest data. It also required 10 percent be fee simple title and sold on the open market to first-home buyers. 

Of six developments proposed in the first round, one 80-home development in Hamilton East is underway. Two developments comprising 1,455 homes are awaiting decision by government, and three others have been declined or withdrawn.  

Council staff have recommended councillors support the latest application to the minister as all of the requirements of the housing accord have been met. They also recommend council delegate authority to the chief executive on how key infrastructure for the 4.2-hectare site will be provided and funded.

The developer - Quentin Residential Ltd - has agreed to fund all infrastructure services required for the development at no cost to the council, or infrastructure providers, the staff report said. 

Like many other local authorities, Hamilton is facing a major capital spending programme to upgrade degraded infrastructure. It had to hike its average rates charge by 9.7 percent this year to achieve its $2.04 billion investment programme over the next 10 years. 

Among the risks identified by council staff was that the project still might not get designation as a special housing area, and that the development yield might be inflated and could lead to fewer houses once a more detailed assessment of the infrastructure and design costs is completed. 

The developer is a partnership between Foster Construction Group, Anthem Homes, Holah Homes and Golden Homes. 

Hamilton is just one of several councils grappling with ways to encourage construction of affordable housing. Earlier this month, Queenstown Lakes District Council approved a 3.6-hectare site in Arrowtown be assigned to the Queenstown Lakes Community Housing Trust. 

The trust plans to build  65 homes at an expected cost of $27 million for a mixed tenure development, in which the trust will allocate housing through various programmes, such as affordable rentals, rent-to-buy and senior housing. The average house value in Queenstown-Lakes is $1.2 million, according to QV data. 

Local Government Minister Nanaia Mahuta still needs to approve the transfer because of the property's status as endowment land. The council also needs to approve the trust's final masterplan. 

(BusinessDesk)

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