1493016352648 - Wellington City Council poised to Shelly Bay land for ‘fraction’ of its true value, developers say

Wellington City Council poised to Shelly Bay land for ‘fraction’ of its true value, developers say

Property developers say they are worried Wellington City Council could sell a slice of waterfront land at Shelly Bay for just $2.7 million, when the land’s true value is closer to $10m.

The land is to be sold to the Wellington Company, which was last week granted resource consent to revamp Shelly Bay, on the Miramar Peninsula, with hotels, apartments, townhouses, a rest home, a ferry terminal, a marina and a cable car link to Mt Crawford.

Richard Burrell and George Wilkinson, directors of Buildings Solutions, say their research into Shelly Bay revealed the council land was worth $10m, but their sources had told them Wellington Company director Ian Cassels could snap it up for just $2.7m.

A city council spokesman said no decision had been made yet on whether the land would be sold or leased to the Wellington Company, and the figure of $2.7m was “wide off the mark”.

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Cassels did not respond to requests for an interview on Monday. But in a brief statement he described the deal as complex and not an “apples for apples” comparison, and that Burrell would not understand this.

Burrell said city councillors should be concerned the Shelly Bay land was being sold at a “heavily discounted” price and he urged them to place the sites with a real estate agent to achieve proper and maximum value for ratepayers.

“If it is the city’s intention to discount the sites for cultural, sporting, urban design or any other reasons, we think ratepayers should be told the reasons why.”

Burrell was also angry there had been no public notification that the land would be sold.

“Councillors must question the proposed costs and the process,” he said.

“They [Cassels and the council] have been tied up working together for a long period of time and Ian is working hard, but I feel council officers have lost sight of value.”

The Wellington Company has a commercial development agreement in place with the Port Nicholson Block Settlement Trust (PNBST), which also owns most of the land at Shelly Bay, to transform the derelict area into the capital’s version of San Francisco’s seaside town of Sausalito.

For this reason, it was unrealistic for the council to offer its Shelly Bay land to any developer other than Cassels on the open market, council spokesman Richard MacLean said.

“In theory, the council could put its land for sale or lease on the open market but that could be seen as a wilfully unnecessary move that could put the viability of the whole Shelly Bay development proposal at risk,” he said.

“It is no secret that the entire site, including the council’s property, is in a dilapidated condition and in need of major investment. The council is eager to enter a deal that will lead to the upgrade of the site and the repair and reuse of a number of buildings.”

MacLean pointed out the Shelly Bay deal would result in a “significantly enhanced” public space for the people of Wellington.

On Wednesday, councillors will vote during a a public excluded meeting on whether to consult the public on the proposed sale or lease of the council’s land holdings at Shelly Bay.

Burrell believed the Shelly Bay development could still go ahead if someone else bought the council land, and said Building Solutions would offer $10m for it.

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