HWCP Management Ltd adds new hotel to its planned CBD project

Wednesday, 27 March 2019

Commissioners Jane Black, John Maassen and Gina Sweetman at the resource consent hearing into HWCP Management Ltd's planned inner-city development in Invercargill.

The group behind the CBD development have now included a new hotel as part of the plans, despite the Invercargill Licensing Trust investing $40 million into a hotel a couple blocks over.

HWCP Management Ltd director Geoff Thompson confirmed at the resource consent hearing into the proposed new inner-city precinct that the long-term plan was to build a new hotel in the block.

The company are proposing to demolish almost all of the block which encompasses Tay, Kelvin, Esk, and Dee Streets and build a largely undercover precinct.

The new block would include retail, food, offices, medical centre, and now potentially a hotel.

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The hotel has been earmarked for the corner of Tay and Kevin streets and would be situated right beside the ILT's Kelvin Hotel on the corner of Esk and Kelvin streets.

It would be built to a similar height as the Kevin Hotel.

HWCP Management Ltd's plans to construct the hotel in the final stage of the overall build which is predicted to take five years.

Thompson, who is a shareholder in HWCP Management Ltd, has made his name in the hotel and tourism industry, given he set up Distinction Hotels which has hotels throughout the country.

Thompson said he had previously expressed an interest in setting up a hotel in Invercargill but was met with some road blocks from the ILT.

He said it had not been confirmed if he would build and operate the new hotel or whether another party, such as the ILT, could take the lead.

The ILT has just committed $40m to its new hotel in Invercargill but Thompson believed there was enough demand to sustain another hotel in the CBD.

He believed business people were staying out of Invercargill because they could not find suitable accommodation. He felt another hotel in the city would provide an economic boost for Invercargill rather than cut into other accommodation providers.

ILT chief executive Chris Ramsay confirmed he had met with Thompson once he was made aware of the planned hotel for the new CBD block.

'It was pleasing to note that our aims for a vibrant city are aligned. As the main accommodation provider in Invercargill, we are intimately aware of the current market and overall occupancy levels.

'Our commitment is to adding more rooms as soon as the Langlands Hotel opens, as long as the demand proves the need. We are sure the community is as keen as we are for the demand to dictate this, as it will mean another profitable property that will enable even more funding to flow from the ILT into the community.'

Thompson is set to invest a significant amount of money into getting the CBD development build, however he described it as 'probably the worst investment he has made' in terms of a business decision.

He said the cost of constructing such a development was more than it would cost in Auckland, yet it would not yield the same financial returns in Invercargill.

Thompson described his investment as philanthropy rather than business, saying Invercargill was his home and he wanted to see the CBD sorted and the city thriving.

'Scott [O'Donnell] and I are putting our money into this, not from a commercial perspective. It would be the absolute worst commercial investment I've made.

'We've invested a lot of time and money into this, but we are doing this because we want to fix the problem in the CBD.

'Our CBD is slowly rotting from the roof down.'