Wakatu Quay Development Project Update
In 2020 Kaikōura District Council was successfully awarded $9.88m by Kānoa - Provincial Growth Fund for the design and development of Wakatu Quay.
Since successfully securing the $9.88m grant to develop this unique location, we have been working to prime the location for development.
Priming Wakatu Quay for development
The significant progress in preparing the location is outlined below:
2020 Demolition and clearance of the old commercial fishing buildings
2021 Designs - Warren & Mahoney appointed project architects and concept designs developed.
2022-23 Infrastructure Enabling Works
- Power Supply: Installation of new electrical transformer to upgrade power supply to the new development. Underground power lines are planned for the site to enable the removal of some power poles to clear lines of sight to the mountains.
- Water infrastructure: upgraded to accommodate Wakatu Quay Development
- Sea wall repairs: The historical sea walls were built over 100 years ago and have stood strong against everything mother nature has thrown at it. With the wharf currently an empty pristine site, it was an opportune time to undertake significant maintenance and repairs costing close to $400k to ensure the sea walls remain robust and sturdy for another 100 years. The repairs are funded by the PGF grant. These include:
- Patch repairs of cracks, ensuring they are sealed to prevent deterioration of the internal structure.
- Reinforcing face and corners of sea walls that are showing greatest deterioration with new concrete facing
- Just outside the wharf the sea is undermining the footing of the walls. Contractors have cleared gravel to bedrock to reinforce the foundations and have installed a drainage channel.
- 2022 - Resource Consent - A resource consent application for the full development of six buildings was submitted in August 2022 which is currently being considered by external planning consultants RMG to ensure impartiality.
- In early 2022 Cooper Developments entered into negotiations with Kaikōura District Council as a private investor to lease Wakatu Quay in its entirety. However, Cooper Developments reluctantly withdrew their interest in October 2022 to focus on an ongoing development commitment in Selwyn commenting, “This has been a difficult decision because of the genuine excitement and passion our team has for this extraordinary development. We also greatly enjoyed working with the KMDP team and Kaikōura Council.”
Next Steps
A condition of the Kānoa - Provincial Growth fund grant for Wakatu Quay is that there must be an investment partner for the project by June 2023 to draw down the remainder of the $9.88m grant.
- Re-marketing Wakatu Quay Investment Opportunity - The Kaikōura Marine Development Project team are re-marketing the Wakatu Quay opportunity from March 2023 to the investment market. It has taken on board advice and learnings from the negotiations with Cooper Developments and is presenting the full opportunity of six buildings to the market. Kaikōura District Council is also open to negotiating with the right partner a partial package involving staged development of the location.
- In June 2023 Kaikōura District Council will confirm to Kānoa its next steps.
Alternative Scenario – Kaikōura District Council as Investment Partner
As well as presenting plans to attract a private investor, Kaikōura Marine Development Project have also scoped out and presented alternative investment scenarios to Mayor & Councillors for their consideration if a private investment partner is not found.
The alternative scenario is for a staged development approach for Wakatu Quay with Kaikōura District Council (KDC) becoming the investment partner. This would require a minimum investment of $800k by KDC to unlock the remaining PGF funding. With this investment two buildings can be constructed on the site that could be leased to tenants for a rental return to the ratepayer.
There are of course risks with KDC taking the lead on the development particularly in securing and managing tenants. However, this approach does offer Council and therefore the ratepayer the potential to make realistic returns on the building lease, and retain full control of the land into the future.
It will also meet MBIE expectations of successful delivery for the project and enable the drawdown of the remainder of the grant.
Mayor & Councillors were presented with both scenarios at the Open Council Workshop on 15 March for their consideration. Any Council funding commitment would need to be confirmed as part of the Long Term Plan (LTP) to be adopted in Jul 2024. This option would also require approval by Kānoa – Provincial Growth Fund.
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