Supermarket giant buys Soho site

File photo / Steven McNicholl

Progressive Enterprises has big plans for failed project locals have dubbed 'Sohole' The site of a former Ponsonby vinegar factory - at the heart of a failed $250 million development plan - has been sold out of receivership to supermarket owners Progressive Enterprises.

The land under the controversial 1.3ha Soho Square urban development project was put up for public tender, and bids closed on April 8.

Progressive Enterprises' general manager of property, Adrian Walker, said the company was excited about the deal, which presented a unique opportunity.

"We look forward to creating new plans for the site in coming months," said Mr Walker, whose company runs the Countdown, Foodtown and Woolworths supermarket chains.

Soho Square developer Layne Kells' company Ponsonby Mall Trust went into receivership at the end of last year, owing the hedge fund Fortress $24 million and failed finance company Strategic $50 million.

Mr Kells bought the former DYC vinegar factory site in 2004 and spent five years working to obtain resource consents to develop 32,300sq m over five buildings in a mixed-use development that included substantial commercial office space.

An appeal was made to the Environment Court for additional resource consents for bigger and taller buildings to take the development to 47,700sq m.

Selling agent Bruce Whillans said the property had attracted six tenders.

"This has been encouraging considering the flat state of the development market."

Receiver Tim Downes of Grant Thornton said yesterday the sale price paid by Progressive Enterprises was a fair reflection of the current market.

Mr Downes previously said some local residents had scathingly dubbed the project "Sohole" and wanted to see the site developed.

Auckland City Council gave consent to plans for the original - an "urban village" - which included about 18,600sq m of commercial office space, 4300sq m of retail, 3000sq m of cafes and restaurants and an entertainment area of 2000sq m, which has been earmarked for cinemas, and a 1250-bay, five-level basement carpark.

Consent for 15,000sq m more space, mainly for apartments, was refused in 2008 by an independent panel of Auckland City Council commissioners, mainly on the grounds of shading, but an appeal was lodged.

- NZPA