Mr Faulkner said the hotel and spa complex could create 200 jobs alone and if all plans came to fruition there could potentially be between 350 and 400 jobs.
"It would be a major employer."
He described the plans as "hugely exciting" for Rotorua.
"We have lost ground to Queenstown. Now is the time to start making that ground back up."
He believed there was demand for a five-star hotel in Rotorua and said the trust was in "serious discussions" with a hotel brand.
Mr Faulkner said the trust was still working through the feasibility process but he believed it was likely to be a 150-room hotel.
"The site is a unique development opportunity. It is 11ha in the middle of the CBD with the Lakefront providing fantastic views and a historical connection to the delivery of wellness and health-related services."
The spa concept was likely to be the first part of the development and the trust was working with QE Health on the proposed redevelopment.
He said there could be some active development on the site within 12 months but the wider development plan was a three to seven-year project.
"There's still a lot of water under the bridge before we decide on layout and how it fits in the overall site."
It has been reported the trust was looking at building a casino but Mr Faulkner said a casino was not front of mind.
He said it could be considered if a moratorium indefinitely prohibiting further casino licences being issued was lifted.
He said some form of casino on the site was a "nice to have, not a need to have".
"If the opportunity presented itself we would consider it."
Mr Faulkner said the trust had spent time carefully working on the master plan and it was "critical" to get it right.
"It's too great an opportunity to take lightly."
The news is being welcomed by Rotorua Mayor Steve Chadwick, who said it would help put Rotorua on the spa destination map.
It showed what could happen when people had a vision and worked together.
Mrs Chadwick said she had been aware of the plans for a spa development for some time and was "delighted" with the plans, which fitted with Rotorua's aim to become a spa destination.
It would mean more jobs, she said, but above all would put Rotorua on the global hot springs and spa destination map.
"It adds to the other experiences that we have got."
She said it was all about having a plan and working together to make it happen.
"It's the right location, right people, right direction and it so fits our plan. I think it is very exciting."
