There are lessons to be learnt from the announcement from Kāinga Ora (KO) that the 175-unit State housing development on Council-owned land in the central city is not proceeding.
The housing project, approved by Council in October 2021, involved Council selling the ZUMO coffee site in Rutherford St for a five-storey building of 50 apartments and the 4 Seasons site in Achilles Ave for an eight-storey 125-unit development.
The original idea was for half the units to be social housing and the other half affordable housing, to be funded by the private sector. KO sought investors but could not find a partner. Council last year relaxed the criteria to allow the private share to be market housing but still no investor was found. The KO project team concluded last October that the project was not viable.
We need to learn from the public money wasted over the past three years on this unrealistic project. The Nelson property development community said years ago that this project was not viable. Central city land is higher priced and multistorey construction more expensive, making social and affordable housing in the central city too difficult. The project also failed because the sea level rise requirements are too rigid.
I also doubt the merits of concentrating social housing in our central city. I was shocked during my recent trip to America at retail and hospitality sectors abandoning city centres due to the concentration of disadvantaged people. The problems in Rotorua and Wellington are also a salutary lesson for Nelson.
There is no question we need more social and affordable homes. I’m very supportive of KO’s developments of 29 in Waimea Rd, nine in Main Rd Stoke, 16 in Nile St and 30 in Examiner St. Council is also strongly supporting affordable housing developments by the Nelson Tasman Housing Trust, Habitat for Humanity and iwi.
It is good to have clarity that this massive social housing project in the central city is not proceeding as Council can now get on with other opportunities for these key sites. It will also bring sharp focus to Council’s Summit next month on revitalising our city.
