The original Pukehinahina Project could have seen townhouses and apartments replace old state houses. Image / Supplied
A project to build hundreds of homes and apartments in Tauranga has stalled after it failed to get Government funding.
The community housing provider behind the project says the setback could push its plan to replace old state housing in Gate Pā back by “decades”, with only eight of potentially more than 600 new homes built to date.
It comes as Tauranga struggles to address a shortage of houses estimated at 5000 and as Government state housing arm Kāinga Ora ramps up its building and buying in the region.
Community housing provider Accessible Properties Limited bought 1138 properties - most of Tauranga’s state housing stock at the time - from the Government in 2017.
Two years later, it announced its Gate Pā “Pukehinahina Project”, which aimed to relocate or demolish 140 former state homes in the suburb and replace them with more than 400 modern townhouses and apartments, transforming whole neighbourhoods.
It now says new medium-density residential standards could have increased the builds to more than 600.
The project hinged on a partnership approach and investment from stakeholders that included time, expertise and planning support, as well as some funding.
The first six new homes were officially opened in October 2019 by the Associate Housing Minister at the time, Kris Faafoi. In total, eight new homes have been built in Gate Pā - but the bulk planned for the project remained stalled.
Accessible Properties chief executive Greg Orchard told the Bay of Plenty Times it had been working with the Ministry of Housing and Urban Development (HUD), Kāinga Ora and the Tauranga City Council for several years to develop a partnership project to increase private and social housing in the Pukehinahina area of Tauranga - but that this was reliant on funding from the housing ministry.
Last year, the council applied to the Government’s Infrastructure Acceleration Fund for money to support infrastructure for new homes in areas of high housing need. This included 1600 properties on the Te Papa peninsula, which has Pukehinahina sitting at the south end. Orchard said the infrastructure funding was crucial for the implementation of the partnership project.
“Late in the process, we were told that the funding needed would only be granted if Accessible Properties committed to a number of conditions, including the construction of a significant number of the Pukehinahina homes.
“This was an unacceptable risk [for Accessible Properties], especially given HUD had not committed to any funding for social housing.”
He said as a result, the council changed its application so it did not include the infrastructure needed for the Pukehinahina project.
“This means that Accessible Properties is currently unable to continue with the project on a community-wide basis and will be working to improve social housing in the area through smaller projects,” Orchard said.
"It is disappointing that the Infrastructure Acceleration Fund process has set back the desperately needed increase in housing supply by years if not decades."
To date, Accessible Properties has added another 58 homes to its portfolio in Tauranga, which Orchard said was the largest of its nationwide community housing portfolios “by far”.
"It is the least affordable main centre for housing in the country and there are around 900 people on the Public Housing Register across the wider region."
Accessible Properties Tauranga general manager Vicki McLaren said Accessible Properties managed about 2900 tenancies nationwide.
She believed the housing provider did its homework on Pukehinahina and it was identified as a priority growth area so the funding process outcome was “disappointing”.
A HUD spokesman said Accessible Properties was an important partner and had existing arrangements to deliver 150 additional public housing places in Tauranga over an 11-year period to March 2028.
“We acknowledge the need for more public housing and recognise the Pukehinahina development is complex, long-term and at a large scale... as such, HUD is not in a position at this stage to commit large scale funding towards this particular development.”
He said the ministry was “committed to working with Accessible Properties”. He said the parties met in December to “discuss how we continue to support them to maintain and grow their current services and investigating the potential for developing new homes, including public housing”.
“This work is ongoing.”
He said the council was responsible for delivering the infrastructure the funding contributed to, as well as determining where the housing it enabled would be developed to “ensure expected housing outcomes are achieved”.
Council strategy, growth and governance general manager Christine Jones said the success of applications to the Infrastructure Acceleration Fund was dependent on a strong commitment by developers to the delivery of those houses, through housing outcome agreements.
The council’s original application was made when Accessible Properties was working closely with Government agencies, with the likelihood of significant redevelopment and housing outcomes in the near-term.
"However, that situation changed during the process and it became apparent that a government partnership with Accessible Properties was uncertain, which therefore meant funding could not be committed."
Without a specific housing outcomes commitment by Accessible Properties, she said the council had no choice but to remove the proposed stormwater investment in the development area from its Infrastructure Acceleration Fund application.
"We could not guarantee the housing outcomes the Government required."
She said the grant of just under $68 million from the fund for Te Papa peninsula infrastructure would support housing outcomes the council could guarantee.
The funding had been allocated to a number of projects including stage two of works on Cameron Rd to encourage the use of active and sustainable transport modes and water supply improvements to enable connections for 1600 additional homes.
“All of these projects will benefit development activities in Te Papa, including Accessible Properties housing projects.
“It should also be noted that the Cameron Rd stage two works include stormwater improvements that will allow future stormwater infrastructure in the Pukehinahina area to be connected to an expanded council network.
"We look forward to working with Accessible Properties and its partners on solutions for its future developments in this area, once their plans are confirmed."
The Bay of Plenty Times Weekend reported on Saturday the agency was embarking on its biggest state house building programme in Tauranga in years, with plans to add 74 homes to its portfolio this year.
As of December, it had 427 state homes in the city, including 197 transferred from Tauranga City Council’s elder housing portfolio. Last year it bought the 95.4-hectare Ferncliffe Farms site in Tauriko with plans to develop 1000 homes.
An NZ Institute of Economic Research report last year found Tauranga had a shortage of up to 5000 homes and projected this would grow to up to 8993 in 10 years.
The Infrastructure Acceleration Fund
- Source: Ministry of Housing and Urban Development
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