Developer accuses QLDC of 'creative inertia'

A developer behind a proposed 2,800-household subdivision near Jack's Point is welcoming his project moving forward on a fast tracked consenting pathway after becoming frustrated by a lack of action to date.

David Wightman, the chief executive of RCL Group, says the Queenstown Lakes District Council suffers "creative inertia".

He thinks the local authority is failing to keep ahead of demand for residential housing and associated infrastructure, and that's a problem the new national-driven legislation can address.

RCL's Homestead Bay project, flagged to deliver thousands of new homes south of town, is included in the central government's Fast-track Approvals Bill.

There are 148 more projects on the government's list and they will be referred to expert panels for evaluation after the bill becomes law.

Of the 15 located in Otago, 10 are in inland Otago, and of these, nine are in Queenstown Lakes. Six of these have the potential to deliver more than 6,000 new homes to the district.

Mr Wightman reckons they can't come quick enough.

RCL is also the developer behind Hanleys Farm, a master-planned neighbourhood in Queenstown's growing southern corridor pitched to family living.

Mr Wightman says it will be sold out before the year is done, yet he has a database of 6,000 potential buyers.

He feels there is "a lack of thought" around 'what next?'.

"What happens after Hanleys Farm leaves the market? Because it's not like people can just click their fingers and deliver the civil and construction infrastructure that is required to roll out a large-scale subdivision.

"There needs to be a supply that comes into the market that can meet the enormous local demand."

He is worried of a development "void" that could mean people with the relevant skills to deliver projects having to leave the district.

"They'll go somewhere else where there is work to do and getting them back is a tough thing."

Mr Wightman says he raised his concerns with the council more than a year ago.

"They said, 'Oh, well, we've got Ladies Mile'. Well, how's that going? We've got a housing crisis, we've got an infrastructure crisis, and I think fast track is actually going to help address that."

Homestead Bay, where developer RCL owns more than 200 hectares of land that it wants to develop (Image: Supplied).

RCL owns a little more than 200 hectares of land at Homestead Bay, close to Lake Whakatipu and Jacks Point, after a deal given green light by the Overseas Investment Office in 2023.

The aim is to achieve a similar vibe to the successful Hanleys Farm, but Mr Wightman says Homestead Bay will also include some higher density residential options "in some pockets of it".

"And obviously it will also include retail and employment opportunities as well, so people can actually live, work and play within the catchment as well."

He is hopeful the project will be one of the first cabs of the rank when it comes to the fast track process.

"Next year would be amazing."

However the site sits on the wrong side of the only-years-old Kawarau Falls Bridge on State Highway 6.

A council report last month warns the bridge is already only 300 vehicles shy of capacity at certain times of the day.

Mr Wightman tells Crux some of the detail in that council report pulls from groundwork his company has done to better understand infrastructure investment needed to progress their own project well.

He explains the bridge is just one piece of the puzzle, and any new bridge will only be able to relieve pressure if a whole network approach is taken.

"At the risk of answering a question with a question, which housing developments in Queenstown are on the right side of a river?

"The traffic infrastructure challenges in Queenstown are not southern corridor specific.

"Whether we were developing more lots in the southern corridor or not, there was going to be an emphatic infrastructure issue across the basin, and we could provide bridges and solutions and so forth in the southern corridor but it was only going to come to a log jam further up the state highway as you got into Frankton.

"It needs a far more holistic solution."

He feels he has been proactive in engaging with council to make it "really clear" that as a developer RCL wants to be part of the solution by "providing and funding infrastructure outside of our property boundary for the benefit of the southern corridor and the broader catchment".

"When we spoke to the council about this project well over two years ago...we spoke to then mayor Jim Boult and council officers, including the CEO, we made no secret of the fact that we were prepared to bring the infrastructure that was identified at the time to enable the southern corridor, which is a damn sight more than any other developer had proposed to do in any other catchment, such as Ladies Mile.

"But unfortunately, for the past two and a bit years, it's been a study in creative inertia from council trying to actually do something about the southern corridor, and now we've got a housing crisis."

He says spatial planning by the council in the years previous had flagged infrastructure issues in the area, but in his view the subsequent response has been inadequate.

Yesterday, Crux reported on QLDC chief executive Mike Theelen's ratepayer supported trip to the United Kingdom with an Infrastructure New Zealand delegation to study regional deals, a concept endorsed by the coalition government.

Without naming Mr Theelen, Mr Wightman talks about hearing news of the study trip.

"It's incredibly frustrating, and maybe amusing, I think, but we offer to step up and at one point I see a council officer who had gone overseas for a symposium on how to attract private capital for infrastructure.

"I'm scratching my head saying, 'Hello? We're already here, we've already had this discussion and nothing is happening'."

Hanleys Farm will sell out this year, but demand from homes in Queenstown remains (Image: Supplied).

What could infrastructure investment by RCL look like? Mr Wightman says it will depend on the priorities of governing agencies like the council and New Zealand Transport Agency, which he is also in conversation with.

In its just signed off Long Term Plan, the council has allocated more than $17 million money towards planning community services and facilities in Queenstown's southern corridor, including a library, community centre, pool and indoor courts - but the money is almost a decade away.

'Disproportionately high number' of Queenstown projects

Queenstown councillor and Infrastructure Committee chair Gavin Bartlett says the council has no more information on the local projects to have made the central government's fast track list than anyone else.

"So far we have only seen the list of projects released...without any further official detail. Our district, and Queenstown in particular, seems to have a disproportionately high number of projects on the list.

"At this stage I am unsure of the process the expert panels will go through in terms of seeking local submissions, including from QLDC, and whether or not the scope of any submissions might be limited. An obvious initial question is the infrastructure demands these developments will trigger, and the council's ability to provide the necessary infrastructure as and when the developments progress.

"Some of the proposed developments have, however, already been anticipated to some degree, such as the RCL Homestead Bay development, which has been considered in the southern corridor spatial plan and the associated projections for roading, three waters and social infrastructure in that area.

"Council staff will no doubt provide elected members with further information as it comes to hand."

Deputy mayor Quentin Smith tells Crux the council has successfully identified land - and he thinks there is "plenty" of it - to accommodate future growth, but admits it is still "struggling to keep up with the demand and the infrastructure".

On top of that, there are "ongoing shortfalls in funding" for NZTA projects and electricity lines companies are "stretched to the limit", he says.

"So to throw 6,000 (homes), many of which are unplanned, a number of which are in new areas of the basin that don't have infrastructure at all and represent brand new townships the size Lake Hāwea is today, just sort of demonstrates the scale of the challenge.

"There's a range of projects there, some of them are interesting, some of them are completely mad and ridiculous, and I'm happy to be quoted on that and I won't tell you which ones are mad and ridiculous."

He thinks some of the projects "support our economy and our community", while some are "relatively self-indulgent".

"The government's move to approve these outside of our normal strategic planning and investment programmes puts council in an incredibly difficult position and will continue to put load on us as a council and ratepayers of the district."

In a statement shortly after the government released its fast track projects, RCL says it had intended to take the "more conventional" Resource Management Act route, and the ball was rolling with the Queenstown Lakes council to achieve this.

It says "extensive technical reporting on matters such as infrastructure and transport" had been supplied, and a full request for a plan variation for an area identified as 'future urban' in the Queenstown Lakes Spatial Plan lodged.

But Mr Wightman is quoted as saying the conventional route had proved slower than anticipated.

"We think we can help demonstrate that quicker planning approvals do not need to come at the cost of the environment, the quality of development or the wider Queenstown area."

Other local projects to have be included in the Fast-track Approvals Bill include a village and gondola at Arthurs Point, a gondola from the valley to the Cardrona ski area and on-mountain accommodation, a golf course and accommodation at The Hills Resort, development of the Remarkables ski area into the Doolans Basin, and residential developments in Gibbston Valley, Queenstown Hill, and Slope Hill.

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Main image (Supplied): An artist's impression of RCL's Homestead Bay, a proposed development of 2,800 households near Jack's Point in Queenstown.