Hastings District Council has sold its former nursery next to Cornwall Park to Hawke's Bay building company Horvath Homes, which also built the council's Best Homes showhome in Havelock North this year.
The council would not say how much it had sold the property on 511 Fitzroy Ave for but its capital value was listed at $460,000.
Horvath Homes will develop the site into a housing subdivision of 12 lots. The existing house will stay and be renovated to complement the development.
The council controlled organisation, Hastings District Properties Limited, negotiated the deal and the subdivision will showcase quality medium density housing incorporating strong sustainability initiatives.
The council decided in April this year that the land used for the nursery was no longer needed and it was transferred to its property company which had a business case for a housing development.
Property development company chairman Peter Snelling said the business case considered three options for the future of the site. "They included selling the site undeveloped, creating a standard housing development, or developing a medium density housing option.
The medium density option was clearly the best in return to the ratepayer and it gives council an opportunity to showcase what can be achieved in a well planned medium density environment."
A show home would be built on one of the building sites at Fitzroy Ave while the balance of the sections will be sold to new home buyers.
Horvath Homes' development plan included a mix of single and two level stand-alone houses which optimised the best solar orientation for each lot and enabled each house to be built to a minimum Homestar rating of six stars.
Director Adam Horvath said the company was delighted to work with the property development company. "Fitzroy will be a benchmark for sustainable development, new home building, and retro-fitting older housing. It will enable us to use and build on the experience we have gained from our recently completed Best Home show home in Whakatomo Place, Havelock North."