A new resource consent for a development at Wellington's Shelly Bay is expected to be lodged imminently.

The former air force base is derelict, the wharf is in pieces and the buildings are covered in peeling paint.

The master plan development to give the "jewel in Miramar Peninsula's crown" a new lease on life includes about 300 homes, a boutique hotel and a large village green.

But it's a plan that has been bogged down in legal action led by Enterprise Miramar Peninsula Incorporated, first in the High Court and then in the Court of Appeal.

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The new consent application comes amid revelations the group behind the litigation has received at least $250,000 in donations to help fund its cause.

The consent is also being lodged after the latest court ruling which quashed a decision granting previous resource consent.

But the project might not be out of stormy waters just yet.

It also faces the threat of legal action on another front, from a group representing Taranaki Whanui iwi members who voted not to sell Shelly Bay to developer Ian Cassels in the first place.

The former air force base is derelict, the wharf is in pieces and the buildings are covered in peeling paint. Photo / Mark Mitchell.
The former air force base is derelict, the wharf is in pieces and the buildings are covered in peeling paint. Photo / Mark Mitchell.

The 30-year development question

The Wellington Company has partnered with the Port Nicholson Block Settlement Trust to develop Shelly Bay.

Developers are largely resubmitting the previous consent application but with further evidence to double down on their rationale for the project on Miramar Peninsula.

In a decision released late last year the Court of Appeal found Wellington City Council made an error of law in its interpretation and application of a section of the Housing Accords and Special Housing Act when granting resource consent.

As a result, matters such as the environmental effects of the proposed development weren't given appropriate consideration by council.

This is after Enterprise Miramar first challenged the council's decision to approve resource consent in the High Court, but lost.

The development itself could take up to 13 years.

Development director Earl Hope-Pearson said the site was significantly challenged in terms of its infrastructure and buildings.

Many have been vacated and are at the end of their useful life, like Shed 8 which is subsiding into the sea.

"Something has to be done, a lot of people have looked at Shelly Bay over the years and I believe the proposal that we have here today is probably the most feasible solution to the Shelly Bay question", Hope-Pearson said.

An artist's impression of an aerial view of the proposed development of Shelly Bay. Photo / Supplied
An artist's impression of an aerial view of the proposed development of Shelly Bay. Photo / Supplied

But some heritage buildings will be saved, including the Shipwrights and Officers' Mess buildings.

The vision for Shelly Bay is to have high-performing sustainable buildings but also beautiful ones, Hope-Pearson said.

Larger structures at the rear of the development have been designed to mould into the escarpment, and front units will be an eclectic mix of individual dwellings.

Sustainability measures include rain gardens which will treat stormwater before it's discharged into the sea.

There will also be an ecological buffer at the rear of the site within the escarpment which will be replanted with native flora.

Even though almost all the land involved in the development is owned by iwi, the plan was to make it inclusive, not exclusive, Hope-Pearson said.

As well as a large village green there will be a village centre with retail, hospitality and a place for the harbour ferry to berth.

An artist's impression of what Shelly Bay South will look like. Photo / Supplied.
An artist's impression of what Shelly Bay South will look like. Photo / Supplied.
Shelly Bay South as it is now. Photo / Mark Mitchell.
Shelly Bay South as it is now. Photo / Mark Mitchell.

Hope-Pearson said they were pushing ahead with development plans despite the threat of further legal action because something had to be done and they believed their option was the right one.

"We're aware that there are parties that aren't happy about what will happen here but it has to happen; keeping what we have here today is not an option."

Legal action coming from within iwi

A group within Taranaki Whanui who voted not to sell Shelly Bay land to developers in the first place are working on a legal challenge.

Mau Whenua alleges the 2017 sale failed to get the necessary support from 75 per cent of iwi members to go ahead.

"The group believes it has a strong case and anticipates the commencement of legal action by May this year," a group spokesperson said.

But a trustee of the Port Nicholson Block Settlement Trust and former chair Neville Baker said they were at this point with the developer because they had the "authority" to do so.

"We took that plan out to the people and we consulted.

"The majority of our people agreed that plan was the way forward. There was a minority who actually objected and who are still objecting but in consultation and working with our own people, you need to take note of what the majority of people say."

The Port Nicholson Block Settlement Trust was established in August 2008 to receive and manage the settlement package for Taranaki Whānui ki Te Upoko o Te Ika.

The financial settlement ended up being $25m and the trust used about half of that money to purchase properties at Shelly Bay owned by the NZ Defence Force and Department of Corrections.

A graphic showing the ownership split at Shelly Bay, red representing privately owned land and blue representing council owned land. Photo / Supplied.
A graphic showing the ownership split at Shelly Bay, red representing privately owned land and blue representing council owned land. Photo / Supplied.

"It is our property and we paid for it and when something is yours then you have the right to develop it and to have the say on it.

"Other people who have got property around the area of Wellington would not think that other people have a say in their rights. We're just exercising our rights and we have a responsibility to get a return on our investment for our beneficiaries," Baker said.

That return will be used to provide better education, health, housing and employment for iwi.

Taranaki Whanui had a historical connection to the land, Baker said.

"We occupied it many many years ago and we're now encouraging a new group of people to occupy it as a community in a different way and so that is about the cultural change that has taken place in New Zealand."

Peter Jackson's email

Sir Peter Jackson once looked at the possibility of creating a movie museum at Shelly Bay, an idea that never materialised.

He owns tens-of-millions of dollars worth of commercial property in Miramar tied to his Weta group of film-making companies.

The details of a scathing email over Shelly Bay sent by Jackson to mayor Justin Lester were revealed last month.

The email, provided to the Herald, shows Jackson and partner Dame Fran Walsh were invited to a meeting with developer Ian Cassels and the Port Nicholson Block Settlement Trust to talk about how they might "be involved" in the development.

"Fran and I are not, and never will be, interested in associating with a team who seem determined to turn Shelly Bay into something that has been described as 'Sausalito' - but which, in reality, will invoke blocks of Soviet-era apartments dumped on Wellington's picturesque peninsula," Jackson wrote.

Jackson also made clear he had no plans, or desire to build anything on Shelly Bay himself, despite rumours suggesting otherwise.

A graphic showing the spatial principles of the proposed Shelly Bay development. Photo / Supplied.
A graphic showing the spatial principles of the proposed Shelly Bay development. Photo / Supplied.

Developer Ian Cassels said Jackson's comments were very disappointing.

"We need to remember that Wellington's growing reputation of 'saying no' comes, eventually, at the cost of people no longer trying.

"The Soviet comment is particularly unfortunate and the exact opposite of what is intended and designed."

The previously published fabricated images Jackson was referring to were pieces of propaganda used to further the cause of those against the development, Cassels said.

They are false and unachievable under the regulations and checks and balances the project has to adhere to, he said.

Those checks and balances come in the form of a design guideline developed for the project, which includes a design panel and moderation by WCC.

An artist's impression of the townhouse lawn of the proposed development of Shelly Bay. Photo / Supplied.
An artist's impression of the townhouse lawn of the proposed development of Shelly Bay. Photo / Supplied.

In the same letter Jackson questioned the estimated cost of $20 million to improve Shelly Bay's infrastructure.

That cost is for both infrastructure improvements and public space development which will be split between Wellington City Council and the developer.

Among the infrastructure in need of attention at Shelly Bay is the coastal road, power and three waters.

Jackson said infrastructure costs would be more like $100m.

"This was the bottom line figure quoted to us when we investigated Shelly Bay as a possible site for a film museum in 2008 ... The WCC has a history of inaccurate budgets and massive budget blowouts and Shelly Bay is set to be yet another financial catastrophe for ratepayers."

Cassels said the cost of $20m was in the correct ballpark and regardless, the council contribution had been capped.

"The remainder and any excess will be covered by us. Currently we are looking to contribute $10m to infrastructure, but even in Peter Jackson's unlikely scenario, we will be paying $90m and the ratepayer will be paying nothing more."

Quarter of a million in donations

Mystery shrouds revelations that at least a quarter of a million dollars has been given to a group that's launched two legal challenges over a development at Wellington's Shelly Bay.

No one seems to know where a lot of that money has come from, including the chair of the group known as Enterprise Miramar Peninsula Incorporated.

The Herald contacted the group's treasurer for clarification on the money's source but was told he does not have the authority to speak publicly.

Financial statements show the organisation has been given significant donations to afford legal action.

A copy of those statements provided to Wellington City Council show Enterprise Miramar received $250,067 in "Shelly Bay Project Donations" for the year ended June 30, 2018.

A graphic illustrating the proposed village centre at Shelly Bay. Photo / Supplied.
A graphic illustrating the proposed village centre at Shelly Bay. Photo / Supplied.

Expenses show $221,798 was used on the Shelly Bay Development that financial year.
In a memorandum of understanding with Wellington City Council, Enterprise Miramar is called a Business Improvement District Association.

A BID is self-funded in that it collects a targeted rate, through the council, from property owners in a specific boundary. That money is then used to undertake programmes to promote and develop their local business economy.

Enterprise Miramar chair Thomas Wutzler said the group was not planning any further litigation and was encouraged by the Court of Appeal's instruction for the council to consider appointing independent commissioners to consider the fresh consent.