A radical plan to tunnel below Queen St for modern trams is being considered by the New Zealand Super Fund, which wants to roll out Auckland's $6 billion light rail project with an international partner.

A political source has told the Weekend Herald the country's pension fund was looking at tunnelling below Queen St to provide a faster and safer route through the city centre.

With 100,000 people now working in the inner city and 57,000 people living there, Auckland councillors voted last November to begin the process of freeing up Queen St for pedestrians.

This is one of the biggest projects New Zealand has seen and extremely complex, given that it is to be built through the middle of some of the busiest streets in Auckland

Auckland councillor Mike Lee, a key player in the revival of rail and public transport in Auckland, said it was ridiculous to underground light rail in Queen St when a few hundred metres away the underground $3.4b City Rail Link was being built.

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Lee said light rail, or modern-day trams, were built at street level and interacted with people.

"Can't they learn from Melbourne," he said.

Auckland councillor Mike Lee says undergrounding light rail on Queen St is ridiculous.
Auckland councillor Mike Lee says undergrounding light rail on Queen St is ridiculous.

A spokeswoman for the Super Fund would not comment on specifics for light rail, but said it was working with international and local experts to refine its proposal with a focus on fresh thinking.

Tunnelling below Queen St would be extremely complex, cause major disruption and cost more, but was indicative of the long-term outcomes the fund had in mind for one of the biggest projects New Zealand had seen.

"We believe that light rail has the potential to be transformative for Auckland's urban development and public transport network," the spokeswoman said.

The Government had plans for two light rail lines in Auckland within 10 years, from the CBD to the airport and from the CBD to Kumeu in north west Auckland.

Last April, the NZ Super Fund teamed up with a Canadian pension fund, CDPQ, with funds of about $350b worldwide, to submit an unsolicited proposal to the Government to design, build, own and operate light rail in Auckland. Government ministers welcomed the proposal, but said the project would be open to all comers.

At the time, Super Fund chief executive Matt Whineray said the fund was attracted to the development risk, size and scale light rail offered to make a difference to the performance of the fund, which stands at about $40b. It would only go ahead on a prudent, commercial basis, he said.

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Artist impression of light rail on Queen Street, which could be undergrounded under a proposal by the Super Fund.
Artist impression of light rail on Queen Street, which could be undergrounded under a proposal by the Super Fund.

The NZ Transport Agency (NZTA) has been working on a business case and procurement process for light rail since May last year, which a spokesman said is nearing completion.

While NZTA officials beaver away on the business case, including preferred routes and the indicative location of stops for the CBD to airport line, the Super Fund has been working with CDPQ on its own proposal for light rail.

The proposal has been drawing on CDPQ's experience building light rail between Vancouver's CBD and airport, and construction under way on a 67km light rail network in Montreal costing $7.3b.

"It's important to note that our plans aren't finalised and will ultimately depend on extensive public consultation.

"We continue to be committed to partnering with Government on the project and remain an active participant in the Government procurement process," the spokeswoman said.

A spokeswoman for Transport Minister Phil Twyford said it was not appropriate to comment on speculation while decisions around procurement were still being made by NZTA.

Auckland Mayor Phil Goff would not comment on the idea of underground light rail for Queen St, but expressed a desire for the Government to choose the best and most economic option to meet the city's rapid transit needs.

A tunnel could be built under Auckland's Queen St for light rail.
A tunnel could be built under Auckland's Queen St for light rail.

A Treasury paper, written last year by national infrastructure manager David Taylor, called for a strong examination of light rail in Auckland given the size of the project, the fiscal risks and the building and operational challenges.

"This is one of the biggest projects New Zealand has seen and extremely complex, given that it is to be built through the middle of some of the busiest streets in Auckland.

"It entails digging up the streets to a considerable depth, causing major disruptions to traffic and business," said Taylor, who noted Edinburgh light rail took six years to build and cost more than twice initial estimates.