- Kāinga Ora sold an Auckland plot for $900,000 plus GST, losing $2m from its 2017 purchase.
- The land was initially intended for a social housing project, but plans were scrapped due to costs and delays.
- Kāinga Ora cited market changes and prioritised other developments, including 200 homes at the Te Mātāwai complex.
Kāinga Ora has taken a big hit on a tiny plot of land in Auckland’s Eden Terrace.
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The Government housing agency paid $2.99 million in 2017 for the 275sqm Upper Queen Street site and resold it last month for $900,000 plus GST.
The property, which has an RV of $1.45m, was first listed for sale in July, but after failing to sell at tender, dropped in price from $990,000 to $940,000 before landing on an asking price of $890,000 plus GST in November.
Kāinga Ora acting general manager of urban development and delivery Nick Howcroft said the $2.09m deficit was the result of market changes.
“The property sold for $1.035m [including GST]. To help us achieve the best price, we followed our usual process of listing the land on the open market, and we’re comfortable that price reflects its current market value.”
The property was put back on the market after Kāinga Ora changed its mind about building a social housing development on it. Photo / Supplied
Howcroft said Kāinga Ora weighed up the overall return from all the properties it was selling, the holding costs of the land, demand for social housing in the area and the benefits of creating opportunities for others to develop the site.
The property was listed for sale with Bayleys in July after plans to build a social housing complex on it were scrapped.
The site was prepared and cleared before 2020, but Covid-19 put the brakes on the project. Howcroft told OneRoof in November last year that the subsequent consent changes, site accessibility challenges, escalating costs and delays meant the project no longer met its financial threshold for a social housing development.
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The full development plans and resource consent for the 10-storey social housing block comprising 25 flats were included in the purchase.
Howcroft said while it hadn’t made commercial sense to deliver social housing on the Upper Queen Street site, the housing agency had provided new social housing in other parts of the Auckland CBD, including more than 200 social homes at the nearby Te Mātāwai complex. It was also exploring other more cost-effective development opportunities in the area.
Bayleys listing agents Phil and Alan Haydock had described it as a “knock-out deal” in their listing on OneRoof. The mixed-use site was pitched as a “strategic purchase for developers or owner-occupiers looking to design their own bespoke premises.”
Kāinga Ora declined to say who had purchased the property, but OneRoof understands it is an Auckland construction firm.
OneRoof reached out to the company for comment and had not heard back before publication.
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