Ngai Tahu's decision to on-sell the former Waimate Hospital has rattled Waimate District Council's plans to develop the site for national and international investors.
Ngai Tahu had first option to buy the hospital under its Treaty of Waitangi settlement agreement with the Government and did so, but only at the last minute.
It bought the building for $65,000 and took possession of it last month.
It had previously assured the council that the site would be made available for the Waimate community.
But Mayor David Owen announced at a council meeting this week that Ngai Tahu had sold the site to St John Properties, a group of Christchurch developers.
He described Ngai Tahu's actions as a "kick in the guts".
"We had been promised for a long time that if we wanted the site we would get it.
"Now they have changed their minds," he said.
Contrary to media reports, the council did not want the site solely for an international school.
"That was one of the options, but not once did I mention an international school at the council meeting. There are 10 interested parties and we are still hopeful they are still interested."
The council has had talks with St John Properties and Mr Owen said the discussions had been promising.
"The new owners seem very flexible. They are there to make a dollar out of it, but also want to listen to our plans."
The hospital had been left to deteriorate while negotiations over its ownership dragged on.
Mr Owen said the place had been "trashed" by vandals.
"But that is the reality of life when a place is deserted. I am a bit sad that it has been allowed to be trashed, though."
The hospital was in an excellent location and a lot of local residents wanted some sort of development on the site.
"It is such an idyllic setting."
The hospital closed in 1995, and Waimate Health Developments offered services from the adjacent Hunter Hills Lodge.
- NZPA
Herald Feature: Maori issues
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