The developer of New Zealand’s tallest apartment tower won exemptions to the foreign investor ban to finish the job, stalled for more than a year.
The 56-level Seascape tower is being built at 83 Customs St East in Auckland’s city centre.
Toitū Te Whenua Land Information New Zealand [LINZ] yesterday released a decision on Shundi Customs, referring to its need to sell to foreigners.
“The development has experienced a number of delays, including most recently due to a dispute with the construction partner,” the LINZ decision sheet said, not naming China Construction which last year left the site.
“The developer has now resolved that dispute and engaged a new construction partner who expects to complete the development by the end of 2026,” it said, not naming new builder Icon.
“The delays have caused unique financial pressures on the developer and the developer is now seeking new finance to ensure the completion of the development. It is a condition of that financing that the existing transactions entered into prior to 2023 are able to settle.”
A Shundi spokesman said LINZ had granted consent but he disputed LINZ’s statement about the business needing new finance.
“As things stand today, this is not accurate and requires a little clarification.
“When we made the application for the renewal of exemptions, it was with the knowledge that, without those, existing pre-sales would not have been able to be completed.
“That would potentially have put financial pressure on us, as one of the standard requirements for financing is to ensure the presales are valid with the new completion date,” the spokesman said.
“Now that we have the exemptions, the new financing terms will accommodate the change of main contractor and additional timeframe, along with other conditions now have being fulfilled, so the comment about finance - while technically accurate at the time of the application -no longer applies,” he said.
LINZ said the developer needed an exemption from the foreign buyer ban, allowing it to sell units overseas even though the apartments are residential property, LINZ said.
Developers of large apartment projects can apply for an exemption certificate that allows foreigners to buy an apartment before construction is complete.
Since 2018, LINZ has granted various exemptions to Seascape, planned before the foreign buyer ban became law.
Now, selling units overseas is crucial to Seascape’s success, LINZ said.
“The viability of the development therefore, depends on the developer’s ability to sell to overseas persons,” LINZ said.
“Compliance with the [Overseas Investment] act without the exemption would be impractical, inefficient, unduly costly, or unduly burdensome. Individual purchasers have options to seek consent for their individual purchases,” LINZ noted in its August 28 decision.
“The developer has now sought a discretionary exemption to effectively extend the time for overseas persons to acquire the dwellings up to two years after the construction of each dwelling is complete,” it said.
That means if completion is later next year, it can still sell units to foreigners through to 2028.
Australians and Singaporeans can buy residential properties here because they are not captured by the foreign buyer ban.
The Government last month announced a partial relaxation of the ban for rich people.
Last month, the Herald reported that wealthy foreigners with an investor residence visa will be able to buy residential properties here.
Prime Minister Christopher Luxon said the general ban on foreigners buying residential houses would remain.
“However, the Government wants to bring additional investment, skills, ideas and connections to New Zealand, and the Active Investor Plus residency visa allows that,” Luxon said.
Jillie Clarke, Shundi’s director of sales and marketing, said a few weeks ago that 55 units of 221 units in Seascape were unsold on levels eight to 20 and levels 41 to 45.
A sales event was held on September 3 to pre-launch marketing.
The Herald sought a sales update from Clarke, Shundi Customs and Bayleys’ Gavin Lloyd.
No new numbers have yet been provided.
Anne Gibson has been the Herald‘s property editor for 25 years, written books and covered property extensively here and overseas.