Tourism giant Real Journeys has begun building a village for its staff at Walter Peak, in response to exorbitant Queenstown rents.
The company has spent $1.5million on three new houses for staff at Walter Peak High Country Farm, to which it operates the vintage steamship TSS Earnslaw.
Chief executive of Real Journeys' owner Wayfare, Richard Lauder, said many of its staff faced "rent challenges" in Queenstown.
"We had noticed seasonal staff were changing their contracts from six months to just three, and that 50% of job applicants inquire about staff accommodation."
Located a few hundred metres from the lakefront, the houses are the first stage of a future "village" of 14 dwellings, of between one and six bedrooms, which will eventually house about 50 workers.
Built in Invercargill and trucked to the site, they were fitted out and connected to utilities a week ago.
They are already occupied by 11 employees, adding to the 10 already living in accommodation at Walter Peak.
At $95 a week for a single room, and $140 a week for a couple — including food and all utilities — the accommodation is vastly cheaper than the $900 average rent for a three-bedroom house in Queenstown.
Mr Lauder said the village would be developed in stages.
The timing of each stage would depend on the cost of housing in Queenstown and the number of people visiting Walter Peak.
"If the only way we can employ people is to house them, then that's what we'll do."
Because of the Earnslaw's fixed sailing schedule, having more on-site accommodation also gave the company greater flexibility to have staff start earlier or finish later in the day.
Rural food and beverage team leader Grace Williams moved into one of the houses a week ago.
From England, she said she could now save for her travels around New Zealand because she was paying much less rent and had nothing to spend money on during the week.
At the same time, she was enjoying a higher standard of living.
"Definitely you wouldn't get a new build like this in Queenstown."
Her initial fears that Walter Peak would be too isolated had been dispelled, and instead she was enjoying the peaceful, rural setting .
She could also take the Earnslaw to Queenstown any time on her days off.
"I go in most days on my weekends, and maybe once during the week."
Real Journeys, which employs more than 1200 people in the lower South Island, already provides accommodation for nearly 80 staff in Milford Sound and at Stewart Island.