Property offload will not be a fire sale: Mayor

By Graham Skellern


Tauranga City Council's move to offload property, and raise much-needed cash to reduce debt, would not become a fire sale, Mayor Stuart Crosby said yesterday.

The council had reviewed up to $300 million worth of land in a property portfolio totalling $1 billion. Some of the land had already been identified as unwanted and more of it might become "non-strategic" at a later date.

Mr Crosby said land would be put on the market when the timing was right. "The last thing we are going to do is have a fire sale."

Some of the land would be a straight sale and the council would look at adding value to other property by working with a joint venture partner on more intensive land use.<inline type="recurring-inline" id="1003" align="outside" enforce-sites="no" />

The "unwanted" or under-utilised land had been included in the council's draft 10-year plan. The first tranche was expected to go on the market over the next three years and raise more than $18 million.

Mr Crosby joined Tauranga MP Simon Bridges and Zespri International chief executive Lain Jager at the Tauranga Chamber of Commerce's City Leaders lunch in the Sebel Trinity Wharf Hotel. They talked about the future of the city.

Mr Crosby said the council was: driving existing infrastructure harder before rebuilding and delaying some new infrastructure to reduce costs; increasing user fees and charges by inflation only; aimed to eventually cap rate rises at inflation plus 2 per cent growth (maximum 4 per cent); and was taking an active role in supporting and stimulating economic growth.

"We've created a more friendly planning environment particularly within the central business district (CBD) by raising the heights of buildings," said Mr Crosby. "When the old buildings need to be upgraded, they can go higher."

He said Maori economic development resulting from Treaty of Waitangi claims was an area of significant growth and the council was supporting the downtown tertiary education campus.

Negotiations for a new hotel in the CBD were making good progress and the council was backing Priority One's endeavours with a conference centre, Mr Crosby said.

"We also want to revitalise and stimulate a major new events strategy in the region - this hasn't really reached its potential," he said.

On local body reform, Mr Crosby said councils should wait until they saw the new rules and found out what the new operating environment would be. Then they could step back and consider what were the best options, including amalgamation.

Mr Crosby favoured streamlining bureaucracy but he warned that since 1989 local amalgamation there had been only one successful merger, Banks Peninsula and Christchurch.

"Fourteen attempts to amalgamate local government boundaries have failed with the last one being Nelson and Tasman districts."

Mr Bridges said Tauranga needed a more vibrant CBD with a cafe culture and more depth in corporate business.

"Cities that aspire to be great do have a heart, and we need (to) revitalise and pay attention to our city centre. And we need businesses of the scale of Zespri, Port of Tauranga and North Island Mussel Processors.

"They are inter-related. If we have a great, vibrant CBD, then corporates will come. Strong and successful businesses can pay salaries of scale and money will be spent in the cafes, restaurants and museums," Mr Bridges said.

Mr Jager said kiwifruit would continue to be a mainstay in the local economy. The new Gold3 licences would be released on May 16 and "we think 1500-2000ha (of existing orchards) will be going into the new variety.

"By 2014, we will be back on the recovery path again producing 30 million trays of gold, and 60 million trays by 2020," he said.

Mr Jager predicted green and gold kiwifruit production would be equal within 10 years. More than 70 million trays of Hayward green was currently being harvested.

This season, Zespri was expecting the gold crop to drop from 30 million to 20 million trays as a result of the Psa infection, and the global marketer was recommending growers switch to the more tolerant Gold3.

Mr Jager said it was still risky, but 88 per cent of the Gold3 already in the ground didn't have secondary symptoms of cane dieback.

He said new cultivars were coming through the system - "we have 100,000 seedlings" - and these cultivars could be bigger than gold, currently providing more than $100,000 to growers for 12,000 trays per hectare.

The new products sold on the market would draw new shelf space and more customers around the world, said Mr Jager. "We are marketing the healthy kiwifruit to be part of the diets for the older population and the fat people, especially."

- Bay of Plenty Times

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