Council splurges on houses

Mayor Andrew Williams. Photo / Paul Estcourt

North Shore City Council has paid more than $1 million above valuation for a beachfront Mairangi Bay home - part of a $25 million spending spree landbanking prime property for parkland.

Nine properties, most near the sea, have been snapped up by the council, at a total cost of $25.65 million, since 2008.

The latest buy, 19 Montrose Tce for $3.4 million, has a Quotable Value valuation of $2.38 million.

The purchases have prompted Auckland City Mayor John Banks to warn councils against "pork barrelling" with the Supercity elections in mind.

The Mairangi Bay property most recently bought is the third of three adjoining properties purchased for a total of $10.5 million. The other properties were bought for $3 million in 2009 and $4.1 million in 2008. Their QV valuations are $2.31 million and $3.65 million.

Banks said big purchases in the last gasp of the council were not a good look for ratepayers.

"At Auckland City Council we've suspended that kind of capital expenditure because we don't think it's appropriate that we should be doing that now."

But North Shore Mayor Andrew Williams shot back: "I don't think we pork-barrel at all. We're continuing with a plan we've had in place for years."

Williams said the purchases came out of developers' contributions.

"We've had a project to increase the size of the park for a number of years. That's not meant to be a vote catch."

Williams said the vendors were not in a rush to sell.

"It was a case where the vendors have been associated with the property for 90 years."

Williams said the council was initially approached by a spokesman for all three properties who were thinking of building apartments on the site.

"That was something that council was most reluctant to see happen. It would have absolutely ruined that area.

"To get that first building, which was basically the key one to stop the development going ahead, we were forced to pay slightly more than valuation."

No apartment consent had been lodged.

"A couple hundred thousand here and there is nothing in the big scheme of things for something that will last 100 years," said Williams.

However, councillor Chris Darby, a former property developer and real estate agent, thought bad decisions were made. "I have to say, council paid over valuation on all of them."

North Shore City Council parks manager Martin Van Jaarsveld said $12 million had been spent this financial year. "What actually happened was the budget for this year was $5 million ... but there was unspent budget in the previous financial year."

The Auckland Transition Agency's finance and treasury manager, Brian Monk, said the acquisitions budgets of all existing councils would be amalgamated into the new Auckland Council planning document.