Tauranga marine precinct sale ‘unconscionable’, council meeting told

Tauranga’s marine precinct, in the lower left corner of the photo, was sold for $13m to a Christchurch developer. Photo / Mark Mckeown

The sale of Tauranga’s marine precinct for at least $4 million below its valuation is a “disaster waiting to happen”, a local business owner believes.

Tauranga City Council sold the precinct at Sulphur Point for $13.987m to Christchurch developer Sam Rofe.

The 2.98-hectare precinct, also known as Vessel Works, was valued between $18.63m and $19.24m and is zoned for port industry. Some sites within the precinct are already privately owned.

Rofe approached the council in late 2023 with a proposal to buy the precinct with a vision of it becoming a “premier superyacht refit destination”.

The sale conditions meant most of the working boat operators would need to relocate from their precinct berths.

As part of the sale, the council also agreed to fund up to $29.2m to develop an alongside wharf and replace the existing Bridge Wharf.

The decision – made under the Government-appointed commission – has been criticised by precinct users and newly elected councillors.

At an extraordinary council meeting on Wednesday, marine precinct users aired their frustrations over the “unconscionable” sale and being forced to leave the precinct.

Fishing company owners Dan and Erika Harvey. Photo / Sandra Conchie.

Erika Harvey, who owns a fishing business with her family, told the meeting in her opinion the sale wasn’t just “a bad deal”, it was a “disaster waiting to happen”.

“The public is paying while the private owner profits.

In her view: “You’ve justified this by promising superyachts will bring in wealth, based on pretty pictures and a vision … but the math doesn’t add up.”

The council’s projections showed each super yacht visit would contribute between $70,000 to $100,000 to the local economy, Harvey said.

“The existing marine industry, which you’re pushing out, workboats, logistic vessels and fishing boats, contributes well over $100m annually right now.

“You’re ready to sacrifice that for a speculative luxury industry.

“The marine precinct was meant to support local fishing and marine industries.”

Harvey called for an independent investigation into the sale of the precinct.

When the council purchased the land from the Port of Tauranga in 2004, covenants were put in place to ensure the site was used for marine-related activities. These were defined as operations or activities that provided goods and services to the marine industry.

Pacific7 managing director Sean Kelly said the council needed to “grow some teeth” and stop the precinct’s sale. Photo / NZME

Owner of marine service company Pacific7 Sean Kelly said the council needed to “grow some teeth and stop the sale”.

He said he planned to file an injunction with the High Court to try stop it.

“We’re only asking for what we were promised. We’re asking for what the marine precinct was designed to be and we’re asking for [the council] to finally deliver it.”

Moana New Zealand general manager Mark Ngata said they had operated from Tauranga for more than 30 years.

As the country’s largest Māori-owned seafood business, he said its partners and fishermen had invested in the region.

“We find it unconscionable that we can put all this investment into this particular area over 30 years and then with a pen we’re gone.”

The precinct is outlined in red; the blue shaded areas were privately owned before the sale. Image / Tauranga City Council.

Tauranga was the second largest port where the company offloaded fish and it invested around $8m per year into the region, Ngata said.

It had returns of $21m from the region which were returned to its 58 iwi shareholders through dividends, he said.

Fisherman’s Wharf, where the council suggested businesses could offload, was not suitable because their boats would not fit under the harbour bridge, he said.

“You’ve displaced us as a sector.”

The public gallery was crammed with around 30 people who applauded the speakers.

Mayor Mahé Drysdale said the sale was now an unconditional agreement and inherited from the commission.

It was up to the new council to find a solution and “make the best of the situations that we’ve been dealt”, he said.

Tauranga City Councillor Rick Curach said the marine precinct was intended for working boats not a "vanity project". Photo / Alisha Evans

Councillor Rick Curach said he wanted an outcome that would not compromise the fishing and workboat operations.

When the land was purchased by the council, it was clear it was meant for fishing and workboats, he said.

“But then this vanity issue came along and totally displaced that; it’s just unconscionable.”

Councillor Glen Crowther said the needs of the fishing community were “pretty simple” – they needed a place to tie up boats, a wharf to unload, and access to ice and parking.

The least the council could do was apologise and find a solution, Crowther said.

Marine precinct activity also had $26.3m of debt allocated to it, but the sale proceeds were initially not going to be used to pay down the debt.

Instead, the $13m was earmarked to help fund the $306m civic precinct Te Manawataki o Te Papa.

Drysdale wanted the $13m to be put towards the debt, which the councillors voted for.

The council would also investigate infrastructure options for the fishing and workboat industry.

How the sale price was decided

Tauranga City Council had to have two valuations done. One valued the precinct at $18.63m and the other at $19.24m.

This did not include the 7195m2 hardstand area, which was valued at $6.12m and $7.81m respectively.

The purchaser, Rofe, agreed to align his offer at a mid-point between the two valuations.

Rofe was also not willing to pay the “harbour front premium” of $3.3m because he believed it was appropriate for residential but not an industrial precinct.

The hardstand area also provided a limitation because it must remain a hardstand which devalued the land.

These valuations and some of the equipment meant the council arrived at the $13.987m sale price.

- LDR is local body journalism co-funded by RNZ and NZ On Air.