Photo: RNZ / REECE BAKER
Housing developers and Wellington City Council say the Te Kāinga affordable housing scheme is well on the way to creating 1500 new apartments in Wellington's central city by 2033.
Property developer Ian Cassels said the scheme was a crucial springboard to promote growth in the capital.
Originally proposed in 2018 by then mayor, Justin Lester, Te Kāinga involved developers converting unused office buildings into residential apartments with the council then taking on a long term lease and acting as property manager.
The scheme was designed to be "cost neutral" to ratepayers - with building owners paying to maintain the buildings - while a property management fee covered the council's cost of managing tenants.
The success of the early stages of the initiative had recently seen the council expand the initial goal of 1000 new apartments to 1500 by 2033.
Scheme could bring 30,000 people to inner city - Cassels
Ian Cassels' development firm, The Wellington Company owned two of the three buildings currently operating within the scheme.
"Unless we get people living in the city, the city has no other way to grow again easily.
"If we put 30,000 people in Wellington in the next ten years - which is more than likely - you would obviate the need for light rail, a four billion dollar device to get you from here to the suburbs. Why not be just walking around the city?
"It's the intensity [of housing] that matters to the country - which we're not getting - and Wellington is the place for it," Cassels told RNZ's Nine to Noon.
Cassels said he was confident the city's unused office space could accommodate up to 30,000 additional residents "easily".
"The city swells to a 108,000 people on a workday. A lot of them occupy high rise buildings. A lot of [those] are now are not occupied. There's going to be space."
Cassels said buildings were selected for their central locations, good light and air and seismic integrity.
He said his company would require a New Building Standard (NBS) of above 67 percent to purchase a building for conversion while all of the council's leases within the scheme required at least an 80 percent earthquake strength rating.
Option for long term tenancies to ensure 'security of tenure' for urban dwellers - WCC
Wellington City Council (WCC) manager of housing development Paul McCorry said the scheme was designed to help bolster the workforces of the city's burgeoning creative and start-up businesses.
"It is aimed at people who are living and working in the city. Our council is resolved to have a priority criteria for people who are working in job creation industries in the city so people who are working in the arts, people who are working in start-ups, people who are working in hospitality," he said.
McCorry said long term tenancy agreements would also offer a security not common in central city housing.
"We might have a long term commitment with a landlord for up to 20 years and we really want somebody who moves into one of our buildings to be able to have that flexibility that - if they want to live there for 20 years too - they can.
"It's about security of tenure for people. Giving them a good strong foundation so they can get on with the rest of their life and have a strong home behind them," he said.
Affordable housing with no impact on rate payers - WCC
McCorry said a property management fee paid by the building owners meant the scheme could operate with no impact to rate payers.
"We're committing to a long term lease which allows [building owners] to pass on a rent that is below market and we can actually pass that rent on to our tenants.
"We have a small tenancy management team and [building owners] provide a management fee as well, which covers the cost of those employees which are looking after our tenants, and makes sure that the whole thing is cost neutral," McCorry said.
The scheme could act as "proof of concept" - for other councils looking to boost urban living - at home and abroad, he said.
"We've been contacted by other councils interested in the program because they see some of the successes we've been having.
"Melbourne, as an example, had some research recently where they identified 86 buildings within their CBD that were suitable for conversion."
