Toxic waste, mayoral storage, and forgiven loans: questions surround council’s land sale

3:00 pm on 24 December 2021

Invercargill City Council has sold a large piece of farmland about 10km south of the city, but is remaining tight-lipped about how much it went for.

Awarua Farmhouse just south of Invercargill, where the council is in the process of selling a large piece of farmland.

Awarua Farmhouse just south of Invercargill, where the council is in the process of selling a large piece of farmland. Photo: LDR/ Matthew Rosenberg

Questions also surround loans that were written off over the project, and why a decision was made to sell this year.

Between March 2006 and June 2008, the council bought about 600ha of land at Awarua with the aim of facilitating industrial development.

This week it confirmed 513ha went unconditional within the last three months, while 96ha would be retained.

The council-owned land most recently made headlines in August when it was revealed Invercargill Mayor Sir Tim Shadbolt was storing personal items in a farmhouse at one of the properties.

Originally purchased over four stages for a total of $9.505 million, the land was acquired with the intention of re-sale.

The council won't divulge how much it has sold for, or who the buyer is, saying the information is commercially sensitive. It also chose not to elaborate on when and why a decision was made to sell.

Sir Tim Shadbolt has previously used council resources to send out his Christmas card.

Invercargill Mayor Sir Tim Shadbolt was storing his personal items at a council-owned farmhouse in Awarua Photo: Stephen Jaquiery/ODT

In 2009, then-Invercargill City Council environmental and planning services director William Watt told The Southland Times the land would be one of the most strategic industrial sites in the South Island.

Watt said he only saw a problem for the ratepayer if it sat for years without being sold, and believed it could be 15 to 20 years before it was fully developed.

Last month, Watt (who no longer works for the council), told Local Democracy Reporting that Invercargill was critically short of industrial land, and the farmland was seen as a "pretty important site".

"The intention always was that it would be a long term strategy by the council to facilitate industrial development as a way of maintaining and increasing the economic critical mass of Invercargill," he said.

"It was a two-pronged objective: to maintain and secure the historic and cultural side of it, which is the Awarua radio station and houses there, and the other things was the industrial land."

Watt said that at the time of purchase, the council hoped the land could be used for industry such as lignite and timber processing, or even off-shore oil prospects.

He said the council had a history of buying ahead of industrial development.

Council has sold most of the land it owns in Awarua, just south of Invercargill

Council has sold most of the land it owns in Awarua, just south of Invercargill Photo: ODT ARTS

In a further twist, the council's 2017/18 and 2018/19 Annual Reports show forgiven loans of $240,000 from Invercargill City Holdings Limited to Invercargill City Property Limited which were repayable only if the project was successful.

Asked how much it had cost the council to hold the land since the time of purchase to the time of sale, the council declined to comment saying the information was not available at this time.

A section of Awarua land which will be retained by the council is also home to toxic Ouvea Premix - a waste product from the Tiwai Point aluminium smelter.

A Rio Tinto spokesperson confirmed there was 1800 tonnes of Ouvea Premix on site at Taha Asia Pacific's old Awarua address.

Information obtained under the Official Information Act this week showed that in September, council chief executive Clare Hadley wrote a letter to the mayor detailing the options available for the removal of his personal items from council-owned addresses, including Awarua farmhouse.

"There is also a small number of items - predominantly a papier-mache bust of yourself - in the basement which could be transferred to the same destination you choose for items from Awarua," Hadley wrote at the time.

While a sale and purchase agreement went unconditional on the Awarua properties in the past three months, settlement would not be happening until sometime in the New Year, a council spokesperson said.

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