Napier council moves on investments safeguard

Napier City Council has endorsed in principle the investment portfolio to be managed by a new trading arm expected to be established by the end of June 2025.

Parklands residential development is expected to be included in Napier's new ratepayer-owned investment management company. The next area of Parklands development was pictured being cleared late last year. Photo / NZME.

The decision came at a full-council Prosperous Napier Committee meeting on Thursday, when the council also endorsed the establishment of a 100% ratepayer-owned Council Controlled Trading Organisation (CCTO) to be named Ahuriri Investments Management Limited (AIM).

The council also approved a maximum of five directors to be appointed, made up of three independent directors and two elected members.

The CCTO was approved to be established after community consultation earlier this year as part of the development of the council’s Three-Year Plan, with the objective of setting up the CCTO to create an investment portfolio that will benefit current and future generations in the city.

Mayor Kirsten Wise said Thursday’s decisions gave the community further clarity on the nature of the investments to be managed on behalf of the city – potentially including Parklands property development, selected surplus property, the leasehold land portfolio, the council’s Hawke’s Bay Airport shareholding, and managed funds.

“We have approved these assets in principle only,” she said. “This will allow staff to carry out due diligence on each asset. In the meantime, it allows our community to understand the scope of what the CCTO will likely manage.”

The CCTO will be accountable to the community and to the council on its investment portfolio’s performance through a statement of expectation approved by the council, expected to be ready for adoption by the end of this year.

“Our intention all along with this CCTO is to protect the value of our investments, which belong to all Napier ratepayers,” Wise said. “In practice this means there would be full public consultation should council want to use the base capital of any strategic assets in the CCTO for a specific purpose.”

The CCTO will be governed by a blend of commercial and council-affiliated directors, and it is anticipated that the legal establishment of AIM will take place in the final quarter of 2024-2025.