Port of Tauranga is partnering with Tainui Group Holdings to build an inland port in the Waikato in a bid to shift tens of thousands of long-haul truck journeys on to the rail network.
The inland port will be a 50/50 joint venture and upon completion could take 65,000 long-haul truck journeys a year off the road and on to the rail network.
It will be located with the Ruakura Superhub in Hamilton - a wider Tainui project expected to be worth "several billion" when completed.
Stage one of the 92ha Ruakura Superhub development will also accommodate 20 to 30 large-scale logistics and industrial tenants, along with ancillary offices, retail and services. Work at the site has already started.
A Port of Tauranga spokeswoman said earthworks were well underway on the roads, stormwater infrastructure and the inland port.
The 17ha first stage of the inland port was due to open mid-2022 and future stages would see the inland port grow to about 30ha, she said.
"The inland port is adjacent to the logistics and industrial hub and will have two 800-metre rail sidings off the East Coast Main Trunk."
Port of Tauranga was investing in the development for economic, social and environmental reasons.
"It will help us serve importers and exports in the Auckland, Waikato and Bay of Plenty regions. They will be able to use the inland port and existing rail network to connect with the big ship services calling at Tauranga.
"Bigger ships are more efficient and have fewer carbon emissions, and utilising rail will remove truck movements off regional roads."
Moving cargo off-road and on to rail was expected to remove about 65,000 long-haul truck journeys a year and the inland port would provide greater cargo capacity as container volumes grew.
"Our joint venture combines our experience and expertise in developing and operating ports, Tainui's deep regional connections and the site's sheer scale and connectivity."
Tainui Group Holdings development general manager Peter Tuck said the Ruakura Superhub would provide critical infrastructure, roads and the inland port.
Since launching the project last year it had committed more than $100m of infrastructure works and had let its first building contract for PBT's new premises.
To date, TGH has completed the bulk earthworks, which included 350,000cu m of excavation, formed the wetlands, roads and swales and started pre-loading the sites in the logistics zone.
TGH and Port of Tauranga have finalised plans for the 17ha stage one of the inland port.
"We anticipate that the 92ha stage one of Ruakura will accommodate 20 to 30 large-scale logistics and industrial tenants, along with ancillary offices, retail and services. So far, we have announced leases with the service centre zone (Waitomo) and PBT. We are engaged with a number of tenants for the balance of the logistics zone and expect to be announcing several of these over the next 12 months."
TGH was co-funding public infrastructure, parks and roads along with local and central government.
"We are also funding the development of the buildings. Our total investment is forecast to exceed $100m by the end of this year.
"It will provide significant opportunities for regional economic recovery post-Covid. Ruakura is classified as a project of national significance because it will help resolve many of the supply chain efficiency issues facing NZ's importers and exporters.
"Ruakura is expected to have an asset value of several billion dollars when fully developed, including the value of the buildings we will develop for commercial and industrial tenants, however this is a multi-generational project.
"We have always said it will take 30-50 years to be fully realised, however, the current trajectory is sooner than this."
KiwiRail Group chief executive Greg Miller said the proximity of the Ruakura hub to the East Coast Main Trunk made it an ideal site for efficiently shifting freight between road and rail.
KiwiRail was working with Port of Tauranga and Tainui Group on a train schedule that would see trains call at the Ruakura hub from both directions.
But Miller said it was too early to comment on the exact schedule because those discussions were still happening.
KiwiRail is a key player in the North Island supply chain and a rail-connected inland port at Ruakura opens up freight options for producers in the Bay of Plenty and Waikato.
"Shifting freight to rail is a vital part of reducing the transport industry's carbon footprint. With rail having 70 per cent lower carbon emissions than road freight, it's an important part of meeting the Government's zero-carbon goals.
"KiwiRail has 18 container transfer sites across the country supporting New Zealand's supply chains and a further nine sites where logs are loaded for transport via rail."