The former Nazareth Rest Home will be bought by Whanganui District Council Holdings and used to house student pilots, Holdings chairwoman Annette Main says.

The rest home, owned by the Sisters of St Joseph of the Sacred Heart New Zealand Trust Board, closed in April last year and was put out to tender.

At the same time Holdings commissioned a report on possible accommodation for the growing number of New Zealand International Commercial Pilot Academy (NZICPA) students.

"We didn't want the fact that we are bringing in students from elsewhere to add to problems around housing availability," Main said.

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The former 46-bed rest home fitted requirements exactly. After an okay in principle from Whanganui District Council and with the help of Palmerston North Catholic Diocese manager Tony Murphy and Property Brokers commercial sales consultant Gil Button, a price and purchase were agreed on.

The rest home and its 2.5ha hillsides and wetland have to be subdivided off from the rest of the Sisters' Mount St Joseph property before Nazareth can change hands.

Holdings will own the property and lease it to the pilot school, just as it leases the academy its premises near Whanganui Airport.

Another entity could get involved in providing student accommodation at the new facility.

"It goes well with the concept of why we bought the pilot academy, to spread the benefits across the community. Having international students is fabulous for our economy," Main said.

Mayor Hamish McDouall is glad Nazareth will stay in local ownership and have a new life as student accommodation.

"Whanganui Holdings have made this decision to accommodate the growing number of students at the New Zealand International Commercial Pilot Academy. Whanganui is seen as a safe location for the parents of international students and I am sure they will be happy to see their family members looked after in such lovely surroundings.

"We will know in more detail what student this students' accommodation facility is going to look like once the purchase is completed," McDouall said.

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The academy has about 100 students at any one time, and most of them are from other countries. There are 30 at Dublin Apartments, and others at the Hikurangi Stay Place, at a motor inn and in private board.

That will continue, Main said, but it will be good to have a lot of the students in one place.

"This is an opportunity for us to continue our pastoral care, which is a very important component of having international students. That's what gives their parents comfort."

NZICPA CE Phill Bedford said a new facility will complement the academy's existing options for accommodation.

''We are delighted to be able to house additional students, as we are currently working through a new pilot training programme which would see an increase in student numbers."

The Nazareth building is more than compliant for use by young and able-bodied people. It has peaceful gardens and a wonderful view of the river and city. Public access to the wetland in the valley will continue, and students may help maintain it.

The building could be adapted to accommodate a person providing oversight, or to add more units, and it has a fully equipped commercial kitchen.

The City Mission community garden and orchard on the hill, and the statues in the gardens, are all to stay.

The Sisters' work in Whanganui has often been with education and youth, Sister Liz Hickey said, and they have another connection with flying. Their former headquarters, near the former Sacred Heart College, was sold to Ryman Healthcare and its new facility is named after a former pupil, World War II pilot Jane Winstone.

"The Sisters are very pleased about the new use of Nazareth, especially after the sadness of the closure last year. Having young people around will bring new life for the building and the site," Hickey said.