A new 240-home Papamoa subdivision which will include some housing subsidies for Maori could set a "precedent for the future".

The residential development - named Manawa, which means "Heart" - was on 20 hectares of Te Houhou settlement land Nga Potiki bought, and was the first development of its type in Tauranga, Nga Potiki Trust chairman Colin Reeder said.

Building companies had bought a large percentage of the sections, and land and house packages were expected to start at $700,000, but some had been set aside for members of Nga Potiki hapu.

Stage one of the project included 110 sites, with 40 sites still owned by Nga Potiki, and was launched yesterday.

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Manawa project manager Peter Cross said the overall design reflected Nga Potiki values around kaitiakitanga and sustainability, with a natural ecosystem, native plants and green space.

"The whole development is designed to encourage interactions with each other. A modern take on the neighbourhoods we grew up in where kids played happily in the street," he said.

Nga Potiki Trust Board deputy chairwoman Victoria Kingi said future stage plans include a commercial area and public artworks, and a retirement village was also being considered. The area had also been earmarked by the Ministry of Education for a new school in 2019.

"As a treaty settlement tribe it is fantastic that we are able to add to our commercial
Investments and be able to provide more meaningful benefits to our members," Ms Kingi said.

"It is definitely a precedent for future developments and the first time in Tauranga that a Maori corporation is involved in property investment for the residential market."

Mr Reeder said it was a "legacy development which acknowledged local culture and history". Streets would be named after women of Nga Potiki, including those taken captive in Musket Wars in the 1800s.

Te Ururoa Flavell, Minister for Maori Development, said Tauranga was leading the way in housing solutions.

''This is a model for others to follow ... let's spread wings and get this happening across the country.''

Tauranga City Council Economic Development and Investment Committee chairman Max Mason said it was a very sophisticated response to Tauranga's housing issues.

"It is a high-quality partnership which focuses on people's needs for affordable housing by offering subsidies, but it is not a cookie-cutter approach - it's an upmarket development with highly regarded commercial building partners and there are a range of housing options on offer from house and land packages, [to] license to occupy and house rentals".

It would make people sit up and take notice, he said.

"It is Maori taking the lead in providing housing solutions, and commercial partners coming on board. I think the way the region's housing issues will be solved is through more partnerships of this type, and there is certainly an opportunity for Maori and hapu members to look to investments like this that provide both a commercial return and excellent social outcomes.

"It is a win, win for everyone in the community."

Priority One projects manager Annie Hill said the provision of additional housing stock would be great for the city from an economic development perspective.

"It will help keep housing prices steady, meaning that we will be able to continue to attract both skilled and unskilled people that are required by our local businesses."

It was great to see the mixed housing options planned for the development, she said.

"Our local iwi are real leaders in the creation of innovative housing solutions, particularly the development of modern papakainga-style housing. It would be great to also see a mix of housing typologies that would be suitable for people at every stage of their life.

"This includes more one- and two-bedroom homes, duplexes and apartments, and housing that creates more innovative ways of living in a community."

Papamoa East had been identified as one of Tauranga's key urban growth areas in the SmartGrowth spatial plan and considerable development is expected there over the next few years, she said.

Subsidy rules

Qualifying Nga Potiki members will be able to apply to purchase sections with subsidies.
* To qualify for a subsidy, a buyer must be a hapu member and satisfy normal lending criteria of the banks.
* The level of the subsidy will vary depending on the total cost of the house and land package.
* If the buyer onsells the house at a later date they can keep the capital gain, less the percentage of the subsidy.
* Nga Potiki will then use those funds from the capital gain to assist other members.