Papamoa's subdivision boom is hastening the day when Tauranga ratepayers will stop being levied nearly a million dollars a year in land purchase costs.
Ratepayers last year began paying the equivalent of a 1 per cent rates rise to cap a loan that had risen from $10 million to $15 million after the Tauranga City Council did a deal in 2007 with property developer Carrus Corp.
The purchase of the 170-hectare farm in Papamoa East's Te Tumu block was to stop Carrus putting in a rural/residential subdivision that would have scuttled council plans for a massive extension of Papamoa to the Kaituna River.
The surge in development in the neighbouring Wairakei block, with the added prospect of Wairakei becoming a fast-tracked Special Housing Area, will hasten the end of the $925,000 rates burden.
Tauranga Mayor Stuart Crosby said that as a rule of thumb, houses would not start being built in Te Tumu until neighbouring Wairakei was 80 per cent full.
But with Wairakei "going gangbusters", it boded well for Te Tumu to go ahead sooner rather than later, he said.
The council's $10 million deal with Carrus in which the Western Bay District Council contributed an additional $5m to the purchase price, was to buy time until planning had been completed to open up the Te Tumu block for development. Carrus had the first option to buy the land back at the original sale price plus all the councils' holding costs in the intervening years.
Carrus Corp chairman Paul Adams said the deal in which the farm was sold for well below its true value was to put the land into a holding pattern until everything was in place to allow residential development.
Mr Adams was keen to get the project under way. "I am looking forward to the council honouring its contractual obligation with Carrus to deliver up a planning change for Te Tumu."
The deal with Carrus was struck a year before the slump that crippled the property market.
Papamoa's growth areas
Wairakei block: 370 hectares
Te Tumu block: 765 hectares
Combined population projection: 20,000-plus