Work has begun on a new nine-hole golf course at Millbrook in Arrowtown as part of a newly consented $50 million development.
The course will be on the 67ha former Dalgleish Farm, which Millbrook bought four years ago.
Alongside the new holes, Millbrook is also setting aside 42 house lots - 24 on the upper plateau and 18 lower down - ranging from about 750sq m to 3000sq m.
Millbrook property and development director Ben O'Malley said the sites were mostly likely to sell for $1million-plus, and doubtless end up accommodating more multimillion-dollar homes.
Millbrook was retaining its 450-home limit, but spreading it out more, he explained.
The resort had let three contracts so far - the main earthworks contract to Ashburton's Grant Hood Contracting and golf course construction and irrigation installation contracts to turf specialist TIC Golf Projects.
That firm developed the Coronet Nine course which opened in 2010.
Coronet Nine's designers, former golf professional and Arrowtown resident Greg Turner and his Scotland-based associate, Scott Macpherson, were retained to design the new nine-hole course.
Work is almost finished on moving the Arrow irrigation pipe to make way for the development and work has started on a 30-million-litre water storage lake.
Mr O'Malley said the storage lake was needed because of the Otago Regional Council's plans to set a minimum flow for the Arrow River.
The river supplies Millbrook's golf irrigation water, via the Arrow pipeline.
A minimum flow could jeopardise golf course operations, as the tees were sand-based and greens required daily watering to meet international PGA specifications.
In other water works, parts of Mill Creek would be widened to enhance wetlands for birds and wildlife.
The creek was also widened through the Coronet Nine course when that was built. .
Millbrook was also supporting an Otago Regional Council initiative, alongside the Friends of Lake Hayes Society, to discharge off-peak water from the Arrow River irrigation race to Mill Stream, which runs through Millbrook into Lake Hayes.
''They believe this will help enhance the water quality of Lake Hayes, and we have the means to provide them the link,'' Mr O'Malley said.
He said the Dalgleish Farm was the last decent-sized contiguous land Millbrook could acquire.
- By Philip Chandler