Developers buy Napier hospital

The Napier Hospital site has been sold after five years on the market, and more than a decade of disuse.

Auckland-based development company Todd Property Group has bought the 5ha site for an undisclosed sum.

Hawke's Bay District Health Board will receive almost $9 million, after holding costs since the property was transfered to the Crown Health Financing Agency are deducted.

 The agency has realised more than $13 million from the sale announced on Thursday, and other land sold from the site in previous transactions.

The health board will spend $5 million of the sale funds on developing a new inpatient mental-health unit.

Board chairman Kevin Atkinson said he was delighted the site on Napier's Hospital Hill had finally sold.

"It's great news for the people of Napier who will now see development on a prime piece of Napier property."

He said the transaction was "as good as we would have got" in 2003.

The hospital closed in 1997, and in 2003 the land was transferred to the Crown Health Financing Agency to manage and sell.

A $20 million sale fell through in 2006 when developer Eyal Aharoni claimed he had been misled about the land's value.

The sale was plagued with problems, as 12 Napier citizens spent more than $10,000 in private funds to challenge the sale in court. Group spokesman Alan Rhodes told Hawke's Bay Today this morning the loss of the hospital was a tragedy for Napier, but the sale was expected.

Mayor Barbara Arnott said the sale would give some closure to a "deteriorating" site, and an issue that was near to people's hearts: "I think the people of Napier will see the Todd Corporation as a safe pair of hands for the site."

She didn't know what the company planned for the site.

"They have been very quiet about [their plans]."

But development would be positive for Napier, and it was a plus that some of the sale profits would go to a needed inpatient unit.

Todd Property Group specialises in planned communities and has residential and lifestyle developments in Auckland and Northland.

In a related transaction, the company sold land at Ngunguru Spit in Northland to the Department of Conservation and was using the proceeds of that sale to buy the Napier Hospital site.

The Auckland-based company is part of Wellington-based Todd Corporation, owned and controlled by the Todd family, estimated to be worth $2.7 billion in the 2011 NBR Rich List.

More on the mental health unit tomorrow.