New housing for seasonal workers is to be built in Cromwell, with the the Central Otago District Council saying it will relieve an accommodation crisis.
The privately funded development will provide more than 400 beds, initially for seasonal workers working in orchards and vineyards.
Council property manager Mike Kerr said the accommodation could also be used to relieve the shortage of affordable housing in Queenstown, which is less than an hour's drive from Cromwell.
The complex, made up of serviced rooms with a communal dining facility, should be available within 18 months.
Central Otago Mayor Tony Lepper called for other private developers to launch similar projects to provide a solution to the area's housing shortage.