Fletcher Residential is an overseas-owned entity. Photo/supplied
Fletcher Residential is an overseas-owned entity. Photo/supplied
Fletcher Residential, partly foreign-owned, has won a special waiver which frees it from applying to the state every time it wants to buy new housing sites in the next three years.
Simpson Grierson's Greg Allen.
Greg Allen, a Simpson Grierson partner, said today Fletcher had been granted the first standing consent for residential landpurchase and development and that lasted till 2022.
The company can now to buy up to 200ha of non-sensitive freehold housing land in Auckland, Canterbury and the Waikato in 12 transactions before May, 2022, he said.
That was the first land consent granted under Overseas Investment Act changes which came into effect last October. Those changes now mean overseas businesses or people must get consent to buy housing land.
The company, wholly owned by NZX-listed Fletcher Building, builds more than 1000 New Zealand homes annually. Fletcher Living lists Auckland projects at Beachlands, Hobsonville Point, Ormiston, Kōwhai Ridge, Stonefields, Swanson, Three Kings, Totara Heights, Waiata Shores, Red Beach and Whenuapai. Canterbury projects are 350 Colombo, Atlas Quarter, Awatea Green and One Central.
Some apartment developers have already got special waivers to sell to foreigners. For example, overseas people can buy units in the new 57-level Pacifica apartments under construction in Auckland despite the Government's law change restricting non-citizens and non-residents' purchase of New Zealand homes.
Gavin Lloyd, residential projects national director at sole marketing agents CBRE, said in December that developers of The Pacifica got the exemption so they could sell to foreigners.
Steve Evans heads Fletcher Residential. Photo/Jason Oxenham
For Fletcher, Allen said the act's broad definition of residential land captured a wide range of land uses.
"Any land acquired in urban areas for the development of new residential housing, retirement villages, supermarkets, service stations or other hardware and gardening stores will likely be considered residential land under the act," Allen said.
"And if the land developer, retirement village operator, supermarket, service station or hardware store operator is an overseas person for the purposes of the act, then approval from the OIO will be required to buy it," he said.
Fletcher is deemed an overseas entity under the act due its ownership. In a 2017 application to the office, it said its ownership was:
• Various overseas persons 34.35 per cent; • Australian public 24.1 per cent; • New Zealand public 22.15 per cent; • North American public 19.4 per cent.
Allen said the standing consent was a form of pre-approval which would enable Fletcher to make multiple acquisitions of housing land.
The Overseas Investment Office says large developers who intend to build multiple dwellings or facilities may choose to apply for a standing consent.
"This allows them to apply for consent before identifying the property or land they want to buy," it says.
"A standing consent could relate to a large area of land, over multiple parcels, and the development of a significant number of dwellings," the office said.
The consent can cover a predetermined number of transactions and may have a use-by date, it says.
Pania Newton protesting against Fletcher's plans. Photo/Michael Craig
Fletcher wants to build at Ihumātao near Auckland Airport but Save Our Unique Landscape protesters have blocked a road to that site in an attempt to stop work starting on a 480-lot Māngere housing estate. Māori land grievances are at the heart of that protest.
Fletcher made $9.4b revenue in the June 30, 2018 year. Its residential division had operating earnings of $136m, up on the previous year's $130m.
The Māngere project could be worth at least $300m once finished, although Fletcher has never released any estimates.
The site is opposite the 100ha Ōtuataua Stonefields Historic Reserve and despite years of protest, land occupation, legal challenges, rallies, criticism and marches, Fletcher is legally allowed to build there.
Qiane Matata-Sipu of SOUL said today: "Fletcher is a transnational corporation driven by foreign shareholder interests. Our country can no longer allow development at any price. The case of Ihumātao shows the huge upset caused when mana whenua interests are not properly considered and land significant to the nation is threatened by destruction, driven by those shareholder interest."
The Overseas Investment Office was meant to protect New Zealand interests, she said, questioning the decision and whether it was in this country's interests.
