AFTER months of debate and hundreds of submissions, the Invercargill City Council has made “the biggest decision they ever made” to invest up to $30 million in the CBD redevelopment project.
With unanimous support, councillors and Mayor Sir Tim Shadbolt earlier this week approved the investment in the inner-city block redevelopment from Dee St to Kelvin St, and Tay St to Esk St.
All the councillors, except Cr Lindsay Thomas who abstained from voting as he was an HWCP Management Ltd director, voted to invest in the HWCP (a joint venture between the Richardson Group and council) project, which they said was “the biggest decision they would make”.
During the two-day council meeting, it was revealed HWCP had asked the council to raise its investment from $20 million to $25 million after a “shortfall of bank funding”.
A further $5 million would be allocated to ICC chief executive Clare Hadley and Invercargill City Holdings chairman Brian Woods to invest in any further necessary change on the design.
In the initial proposal, HWCP had asked council to invest $20 million as part of the $180 million needed for stages 1, 2, and 3 of the development.
A further $10 million contingency was included in the City Centre Block Consultation Document.
The other four investors would also invest $20 million each to make up the $100 million build cost.
A further $80 million was hoped to come from bank funding, but this was reduced to $50 million, making it necessary for the council and two other investors to “fill some of the gap from the bank”.
The $30 million investment would be funded through a loan, resulting in an estimated 1.2% rates increase.
Through its holding company Invercargill City Properties Ltd, the council had already invested $5.45 million with HWCP Ltd.
Cr Lesley Soper said she was excited with the outcome and moved the recommendation.
Cr Ian Pottinger raised concerns and suggested council explore other options to fund the project.
He said he supported the project but believed any design changes which needed to be negotiated should have approval of full council. Cr Darren Ludlow and Cr Karen Arnold disagreed.
Cr Arnold said council should “trust the people that you nominate”.
Cr Lloyd Esler said despite some negative points, he was confident it was the right decision.
“This project will be a setback for some other projects that have been pushed back… but I’m overwhelmingly convinced this is the correct answer for Invercargill – it’s a great opportunity.”