Barry Trass, left, of Northland Development Corporation is hopeful both councils would come to the party to get the project over the line.
Photo / Michael Cunningham
Barry Trass, left, of Northland Development Corporation is hopeful both councils would come to the party to get the project over the line.
Photo / Michael Cunningham
The collapsing house-of-cards funding Whangārei's proposed $93 million conference centre has suffered a fresh blow, with the Northland Regional Council attaching conditions to its reduced contribution.
The regional council is now proposing foundations for the building be in place before it contributes ratepayer money.
Northland Regional Councillors will meet nextweek to discuss the proposal. It follows the regional council reducing a commitment to put $14m into the Riverside Dr development to $6m.
The $220m hotel and conference centre development on the Whangārei's Riverside Dr, being spearheaded by Northland Development Corporation, is in danger of collapsing after the Whangārei District Council withdrew its funding contribution to the project.
The Government had put up $60m for Oruku Landing Development and further funds were to be contributed by local authorities.
Whangārei's proposed $93 million conference centre is in doubt as the NRC has reduced its contribution.
Whangārei council was to contribute $17.6m for infrastructure such as roading, stormwater and wastewater networks - but had made the funding conditional on the regional council putting up $14m to fit out the building and its due diligence inquiries into the project.
After the regional council reduced its contribution to $6m, Whangārei's council announced that it had removed funding for the project from its long-term plan.
Those sums were specifically for the conference centre fit-out and not the hotel development.
Prosper Northland Trust (PNT) backed the development and trustee Ian Reeves has written to NRC Councillors urging they reconsider the decision to reduce funding and the condition.
He said while regional council decided in September last year to contribute $14m, it declined to be responsible for cost overruns. Whangārei council then requested PNT to take over the project so it had control over cost overruns.
"I cannot envisage another offer of $60 million from the Government in the future - we will lose the convention centre for many decades, and without a convention centre, it is doubtful when Whangārei will get a hotel," Reeves said.
He said regional councillor concerns could be resolved and Northland Development Corporation directors should be invited to address them directly.
"Requiring hotel foundations to be in place before payment creates timing problems. It also creates uncertainty for the Government and the WDC."
Regional council chairperson Penny Smart said the condition on when funding would be released was put in to reduce risk around the project. It would be discussed by councillors at the July 7 council meeting.
Ian Reeves of Prosper Northland Trust is urging NRC to reconsider its decision to reduce funding for a new conference centre.
Photo / Michael Cunningham
The regional council's decision to grant $14m divided public opinion.
During its consultation on the Long Term Plan 2021-2031, it received 43 submitters opposed the decision while 33 were in favour.
Whangārei council spokeswoman Ann Midson said funding for the conference centre was likely to be discussed at a full council meeting on July 13.
NDC director Barry Trass said the change in funding by the councils was frustrating but he was hopeful am amicable resolution would be reached.
"It's not the end of the project. If NRC cannot commit $14m, then we've got to find that money elsewhere or reduce our costs. The NRC contribution is meant for the fit-out of the interior and is meant to come in later in the project."
WDC's Long Term Plan consultation proposed it include $23m towards Oruku Landing in the 10-year plan subject to a number of conditions being met, including a commitment of $14m from NRC, and a satisfactory outcome of due diligence investigations.
WDC withdrew funding after NRC approved only $6m and matters arose during the district council's due diligence process that would require further investigation and negotiation.
