Kāinga Ora rejects 'win-win' land swap as hotel looks to expand

Thursday, 9 July 2020

A Kāinga Ora home earmarked for demolition is all that stands in the way of Chateau Marlborough’s western expansion.

A five-star hotel’s expansion plans have hit a snag – the neighbouring property is social housing, and the Government has other plans for the site.

Chateau Marlborough wants to add 30 new rooms to the southern wing of its central Blenheim hotel, to be followed by a conversion of its penthouse into conference rooms, and the roof into a fourth-floor open-air bar.

The southern wing of the hotel was designed to allow for westward expansion to the right, along Charles St.

But the hotel needs to buy the house next door for expansion west along Charles St, owned by the Government’s social housing provider Kāinga Ora.

The 633sqm property is one of four state homes on the Charles St block soon to be subdivided into 10 accessible one-bedroom units, some standalone, some duplex.

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Chateau Marlborough co-owner Trevor Marshall says he thinks his land swap solution is a good deal for Kāinga Ora.

Kāinga Ora filed consents to subdivide and build in January, but the Marlborough District Council has not yet granted those consents, asking for further information in May.

The 1940s state home is one of four in a row along Charles St to be replaced by 10 one-bedroom units.

Chateau Marlborough co-owner Trevor Marshall said he had been discussing his expansion plans with Kāinga Ora for nearly two years.

“We were aware they were looking at doing redevelopment of this land here, and we think that’s great because I come from social housing myself, so I don’t have any problems with social housing whatsoever,” Marshall said.

Chateau Marlborough bought a house on Richmond St, hoping to swap it with Kāinga Ora’s property at 104 Charles St.

“So I do think this redevelopment is a great thing for the community, we do need more state homes.

“But once these houses are built, the opportunity is gone forever.”

The hotel had expanded a few times over more than three decades to its current 80-bed iteration. The southern wing on Charles St was added about three years ago.

Disability advocates say the public housing agency, Kainga Ora, needs to set its sights higher when it comes to making more houses accessible.

Despite economic uncertainty during the coronavirus pandemic, Marshall said he believed Marlborough’s hospitality sector would recover by the time the southern wing extension was finished.

“It’s a great opportunity for tourism, we see the high-end market rather than the backpackers and freedom campers. We want those spenders here, and this is an opportunity to get more of them here.”

Marshall estimated the extension would create 20 extra jobs at the hotel, and work for the construction industry.

Kaikōura MP Stuart Smith has been helping Chateau Marlborough with their expansion plans.

Chateau Marlborough bought 1 Richmond St, which bordered two of the state home sites, in October last year, hoping to swap it with Kāinga Ora for 104 Charles St. The house was currently being used as staff accommodation.

“The property we’re offering them is actually bigger than the piece of land we want, which means they could build more housing. It would square up the whole site. They could redesign it and actually have more room … it could be 12 houses with good design,” Marshall said.

But Kāinga Ora declined the offer, saying their plans had advanced too far to alter.

The National Party’s new housing spokeswoman Nicola Willis says more state homes must be built.

A spokeswoman for Housing Minister Megan Woods confirmed she received a letter from Chateau Marlborough about the proposal in October, and had advised the hoteliers it was an operational matter for Kāinga Ora.

Marshall said he had contacted several ministers but Woods was the only one that responded.

“Here we have the prime minister saying they want to help small businesses and grow the economy. Well get on board, this is a win-win situation for everybody, but nobody is listening. It makes a mockery of the Government’s goal of helping businesses.”

A Kāinga Ora spokesman said the agency had committed too much to the project to change now.

”Further delays could lead to higher costs, or at worst, the cancellation of the development, preventing potential work opportunities and the delivery of 10 much-needed one-bedroom units in central Blenheim,” the spokesman said.

Kaikōura MP, National’s Stuart Smith said he could not understand why Kāinga Ora would not take the deal. He had been helping Chateau Marlborough with the issue for some time, he said.

“It could be a win-win situation, in fact, for both sides … We need more social housing, and this would create more jobs for Marlborough’s construction industry, and permanent jobs for the hotel when it expands … and more hotel beds much-needed in Blenheim, and they’re worried about a delay?

“The ministers are just asleep at the wheel with this one … perhaps they would rather announce millions than do something rather mundane but which would actually get a result.”

He and National's new housing spokeswoman Nicola Willis believed bureaucracy trumping logic was a widespread problem in the Government’s approach to social housing, he said.

Willis told RNZ this week National was wrong to sell or convert “a couple of thousand” state homes when it was last in office.

She was commenting on the news that the number of households waiting for state housing had hit a new high. More than 16,000 households were “Priority A”, or had urgent need. The wait list had trebled from the 5844 households on the wait list when the current Government was elected in September 2017.

An extra 2813 state homes had been built since June 2018 and a further 2596 were under construction.

Willis said more state homes should be built by whichever party won the general election in September, but should be accompanied by reform of the Resource Management Act (RMA) and rental regulations to encourage property investment.