Marcus Jacobson, developer for the Ngongotahā housing project, pictured at the site in September 2023. Photo / Andrew Warner
Marcus Jacobson, developer for the Ngongotahā housing project, pictured at the site in September 2023. Photo / Andrew Warner
The developer behind plans to build 350 houses on Government land at Ngongotahā says the development is on track despite his other company for another Rotorua housing project owing millions and being placed in liquidation this month.
The Government, which has paid $8 million for landfor the Ngongotahā development, says it is not concerned about the Ngongotahā project and the Crown would retain ownership of its investment should any developer have trouble finishing it.
Marcus Jacobson, of Watchman Residential, said the funder backing the Ngongotahā project was different to the funder involved in the company behind the now-insolvent Mountview Green development at Koutū.
Developer Marcus Jacobson. Photo / Andrew Warner
Jacobson is the sole director and shareholder of Roto Whare, which owns the final stages of the Mountview Green development. Jacobson this month appointed Waterstone Insolvency’s Damien Grant to the company as liquidator.
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It was revealed this week Roto Whare owes money to several Rotorua businesses, but the biggest debt of $28.2 million is to an American business, Florida-headquartered financier Quaestor Advisors LLC, of Jacksonville.
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Details of what Roto Whare owed were revealed in the liquidator’s first report. Among Rotorua businesses out of pocket were Metal Line Roofing, Rotorua ITM, Davidsons, Design Tilers, Handon Heating, Sigma and Redwood Joinery.
In response to Rotorua Daily Post questions, Jacobson said the two projects - Ngongotahā and Koutū - were not related.
“Mountview was placed in liquidation because of financing issues ... Mountview is close to completion, with most properties completed and sold. The issues at Mountview are specific to Mountview and relate to financing.”
He said Ngongotahā was a “completely separate project”.
The Government bought 31 Ngongotahā Rd for $8 million. Photo / Andrew Warner
“The funding entity is not related and the entity that financed the Roto Whare project is not involved. The Ngongotahā funders and suppliers are supportive.”
Jacobson did not reveal who the Ngongotahā funders were.
He said the Ngongotahā project was going ahead as planned.
“Siteworks at Ngongotahā have commenced and I am excited about the status of the project … the development can’t be linked to Mountview. The Government owns the land. Community housing will be part of the development, but the project is privately funded.”
Jacobson is the sole director of Watchman Residential. There are three shareholders, including Jacobson and his wife Andrea, with 1% shareholdings each. The 98% shareholder is AH Trustees (Watchman Trust) Ltd.
What the Government says
A Ministry of Housing and Urban Development [HUD] spokesman said the ministry entered into a development agreement with Watchman Residential for the development of at least 320 dwellings over the next decade.
A requirement of the development agreement was that Watchman Residential secured suitable financing, the spokesman said.
Other than having a shared director, Watchman Residential was not involved in the Roto Whare Limited project, as they were separate entities, the spokesman said.
“In addition, the two projects do not have the same funder.”
The spokesman said the ministry would not contribute grant funding for the Ngongotahā development and the funds invested by the ministry – including the $8 million it spent to buy the 15.9ha site and the Memorandum of Understanding for design and consenting costs – would be returned to the Crown.
What the proposed new houses at Ngongotahā will look like. Photo / Supplied
Asked how the Government came to partner with Watchman Residential and if there was a tender process, the spokesman said Watchman Residential brought the site opportunity to the ministry and was “well placed to deliver housing in Rotorua”.
“The developer successfully progressed through a single-party request for proposal process where its capacity and capability were assessed by HUD as sufficient to undertake this development.”
The HUD spokesman said it did not have concerns about the Ngongotahā development.
“Noting that HUD monitors development risks and mitigations of all the developments it is involved in.”
The spokesman said in “land for housing” developments, the Crown owned the land until the houses were complete and developers were not allowed to take mortgages over the land.
This meant in the worst-case scenario of a developer being unable to complete a development, the ministry would still own the land and be able to contract a different developer to finish the job and recoup the Crown’s investment.
What is the Ngongotahā development?
An independent panel granted Watchman Residential resource consent under the Covid-19 Recovery (Fast-track Consenting) Act 2020 in August, subject to conditions, for the first stage of the project involving 202 homes.
The development will be at 31 Ngongotahā Rd. The consent includes approval to build a large wetland area at the site’s rear that developers have said will mitigate flooding risks – an issue of concern for residents and iwi.
Watchman Residential director Marcus Jacobson addresses a public meeting in Ngongotahā. Photo / Andrew Warner
Opposition to the proposal has been expressed at two public meetings. Locals are mainly worried about flooding, lack of infrastructure and traffic congestion.
The site was first considered for a housing project involving 80 homes in 2018 but concerns about flooding and congestion led to its eventual rejection by then-Housing Minister Megan Woods.
The Government bought the 15.9 ha site in 2022 for $8 million and has signed a Memorandum of Understanding to work with Watchman Residential to build a total of 350 publicly and privately owned homes in three stages. It hasn’t been said yet how many homes will be publicly or privately owned.
Kelly Makiha is a senior journalist who has reported for the Rotorua Daily Post for more than 25 years, covering mainly police, court, human interest and social issues.
