City’s Peacocke repayment problems revealed
Monday, 27 July 2026
Official documents reveal Hamilton’s key Peacocke housing development needed early Government help to keep it solvent as a covid building slowdown left a long hangover.
The half billion dollar transformation of Peacocke has been eight years in the making, requiring a complex funding model involving council investment, developer contributions and substantial central government support.
However, early slowed repayments will leave the ratepayer forking out more in coming years.
A major boost came in 2016 through the Government’s Housing Infrastructure Fund (HIF), which provided a $180.3m 10-year, interest-free loan alongside a $110.1m subsidy.
However, Housing and Urban Devleopment (now MCERT) responses to a Waikato Times Official Information request show Hamilton City Council quickly ran into repayment problems.
In April 2021, the council requested a change to repayments on its loan commitment after confirming to HUD that it was well behind its assumed housing development rate, which is tied to repayments through development charges.
By March 2021, an email from then council strategic development manager Andrew Parsons revealed just 219 homes had been completed, when the council had expected to have completed 630.
Parsons put that down to “Covid 19 disruption and uncertainty’’, requesting a three-year delay on loan repayments to reflect the ”delay in development”.
It’s not clear what the precise cause of that was, and an email from a senior policy advisor at HUD indicated genuine surprise that the council was in need of assistance, particularly as “construction work is permitted under Level 3 restrictions’’.
Further correspondence showed the council then wanted to “mitigate council’s expenditure against costs exceeding budgets by $16.4m’’ by deferring several combined repayments totalling the same amount.
The proposal to alter the council’s $180.3m portion of the $290.4m HIF Facility agreement was put before then Finance Minister Grant Robertson and Housing Minister Megan Woods for a decision in 2022.
Cabinet briefing papers stated it was “related to cost increases to the Waikato River Bridge component of the Peacocke project’’.
Cabinet briefing papers also noted this cost increase had not yet been realised. Only $2.1m had been realised in cost increases with the remainder “projected’’ costs.
The agreed changes mean the council will now pay around $1.5m a year more in repayments ($3.3m in total) in 2032 and 2033, then $2.7m a year more ($4.8m) from 2034 to 2038.
A spokesperson for the new Ministry for Cities, Environment, Regions and Transport told the Waikato Times the changes to the repayment schedule and the deferred payments were not made public because the overall repayment total remains the same and the new repayment schedule “was consistent’’ with the overall requirement that each drawing be repaid within ten years.
In a project close-out report Hamilton City Council says overall the project has cost $489.3m to-date, with a further $13.8m of minor works still to come.
The final piece of major infrastructure, Whatukooruru Drive Stage 3 between Hall Rd and Ōhaupō Rd, is due to open by the end of July. When complete, all nine core projects in Peacocke will be finished — collectively coming in $41.2m under budget.
The Waikato Times asked the council for an itemised breakdown of the costs associated with the need to defer the HIF payments.
However, the council response from chief financial officer Gary Connolly said the $16.4m was was not a cost overrun.
“Council plans a contingency budget for construction projects where it is deemed appropriate, acknowledging that unforeseen factors can impact delivery.
“Covid-19 was an extraordinary disruption – Level 4 lockdowns and the economic impact of Covid, including post-Covid supply chain disruption added significant cost to the project.
“This resulted in $16m contingency budget being fully utilised.
“Despite this, other infrastructure project aspects in Peacocke have been delivered within the total approved budgets.’’
The council’s latest Economic Report shows in 2025, 100 new homes were consented for Peacocke. That is double the number from the previous year but still just half the amount built in 2021.
Council commercial and analytics unit director Greg Carstens says 204 homes have been completed over the first three year period - 361 fewer than expected.
“The 2024-2034 Long-Term Plan projected a total of 565 completed homes over three years.
“Tough economic conditions and global uncertainty have impacted development delivery in recent years.
“However, there remains strong developer interest and commitment to delivering housing in Peacocke.
“A substantial development pipeline is in place, with more than 2,580 lots lodged or consented, ongoing land consolidation activity, and pre-application discussions progressing. Significant development is already underway, including the Aurora housing development in the south and construction of the Broadwater retirement village in the north. Together, these projects provide confidence that housing delivery in Peacocke will continue to grow as market conditions improve.’’
It is intended that Peacocke will eventually be home to about 20,000 people. We expect about 6300 homes in the area by 2041, with capacity to grow to a total of 7400 homes by about 2050.