Whanganui District Council will buy Whanganui Furnishers (left) and Wakefield Chambers (right, on the corner of Victoria Avenue and Ridgway Street). Photo / Bevan Conley
Whanganui District Council will buy Whanganui Furnishers (left) and Wakefield Chambers (right, on the corner of Victoria Avenue and Ridgway Street). Photo / Bevan Conley
The Whanganui District Council has voted to snap up properties in Whanganui’s central city, with the potential end goal a new hotel and carpark facility.
However, some councillors have questioned the decision being made before hearings on the council’s long-term plan (LTP) for 2024-2034.
An online petition has been started in opposition to the purchases.
The council will spend $3.916 million on land and buildings on lower Victoria Avenue, Ridgway Street and St Hill St.
The annual return on capital for the purchases would be about 5 per cent - net $190,000 per year - and the purchase would not cost the general ratepayer anything, he said.
“All the profits from the portfolio have been ring-fenced and put into a reserve.
“It is that reserve that should fund almost all of the acquisition. The small balance left over will be funded by some debt.
“That debt will be serviced by the future profits of the portfolio.”
City endowment reserves will cover $3.5m of the purchase, with debt making up $416,000.
Whanganui district councillor Jenny Duncan. Photo / Bevan Conley
Councillor Jenny Duncan said she supported the hotel plan but the timing of the purchases was “really poor” and could look bad to the public.
“Why was the unconditional date not made after June 7, so we didn’t conflate the matters and look, to the community, like we were going ahead with something?” Duncan said.
The purchase agreements go unconditional on May 13.
Langford said council management was following through on instructions from councillors “to pursue these things”.
While purchasing the properties was an acquisition for the endowment portfolio that enabled the possibility of a hotel, it stood alone as an investment that would grow non-rates revenue, he said.
“Which is what you’ve asked officers to do to keep rates affordable,” Langford said.
Councillor Rob Vinsen, with support from councillor Philippa Baker-Hogan, moved a procedural motion to adjourn the item until the next council meeting on June 7, but it was lost.
Properties on the table were 33 Victoria Ave through to 36 St Hill St (Whanganui Furnishers), 63 and 65 to 71 Ridgway St (referred to as the Flynn properties) and 45 to 49 Victoria Ave and 51 and 61 Ridgway St (Wakefield Chambers).
Vinsen said he supported buying Wakefield Chambers and the Flynn properties but not Whanganui Furnishers.
A carpark, which would likely be built on part of the Whanganui Furnishers property, was “pie in the sky”, he said.
The majority of councillors voted to go ahead with the purchases “on the completion of satisfactory due diligence”.
Councillors Charlie Anderson, Peter Oskam and Baker-Hogan opposed all three, Vinsen opposed Whanganui Furnishers and Michael Law opposed the Flynn properties.
Speaking to the Chronicle, Mayor Andrew Tripe said that while the hotel and carpark project had a figure of $55m, nothing had been spent yet.
“We won’t commit to spending any of that capital outlay for a hotel until we have a comprehensive business case completed,” he said.
“We will also be looking at the model. It may be that if it’s attractive enough, a developer could come in and a range of different operators could be interested.”
Tripe said the business case would “tell anyone who is interested in investing whether it’s a good idea or not”.
Wanganui Furnishers stretches from Victoria Ave to St Hill St. Photo / Bevan Conley
An online petition opposing the purchases was started on Tuesday morning before the council meeting began.
By midday on Wednesday it had received 176 signatures.
The petition said progress on the hotel project had not been shared with residents to help them with their long-term plan submissions.
The council should halt the purchases “until all plans have been fully disclosed to our community and further public consultation made” or it should vote for option two of the long-term plan, it said.
The public had the chance to share their views on the hotel plan through consultation on the LTP.
There were three options - go ahead with the plan subject to the business case (option one), seek an operator to develop a hotel and carpark for Whanganui (option two) or do nothing (option three).
“Whanganui is still recovering from the huge cost of the [Sarjeant] art gallery upgrades. More public consultation is required before committing the ratepayers to another large-scale project,” the petition said.
A report from council property and open spaces general manager Sarah O’Hagan said last October the council approved a budget of up to $1.5m to commission and complete a feasibility study and design work for the hotel and carpark.
The feasibility study was under way and was “supported by international expertise through [commercial property company] JLL New Zealand”.
Discussions with multiple operators to canvass interest in operating a hotel in the central city had resulted in a written proposal from the King and Queen Hotel chain, the report said.
King and Queen is based in New Plymouth.
Tripe said King and Queen Hotel representatives had visited the city a couple of times.
“They are our regional neighbour and, from their perspective, we are on their travel path.
“For any expansion they may make, Whanganui is a sensible next step.”
Mike Tweed is an assistant news director and multimedia journalist at the Whanganui Chronicle. Since starting in March 2020, he has dabbled in everything from sport to music. At present his focus is local government, primarily the Whanganui District Council.
