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Below market rate: council to lease 35 new inner-city apartments for essential workers

News from WCC
A New Zealand-first model to help bring more affordable and quality rental accommodation to the central city has been unveiled in Wellington. The apartment conversion deal is aimed at allowing key workers to live in the city. The Wellington City Council and The Wellington Company (TWC) have entered a 15-year agreement which will see TWC convert Freemason House, 95-201 Willis Street, into 35 apartments.

The apartments will take up five floors of the nine-storey 1980s office block. Commercial tenants will remain on the ground and other floors.

Mana whenua have gifted the building the new name Te Kairanga Aroha.

The Council will lease the quality one-, two- and three-bedroom apartments from TWC and rent them out at less than the market rate to people who are employed in essential work in the central city and who have trouble finding rentals.

Tenants’ rents will be tied to increases to the Consumer Price Index and not the market rate. Tenants will have to meet certain criteria to be eligible for the units.

The model, which is cost neutral to Council, can be rolled out to additional buildings in the city that meet the criteria.

Delivering inner-city conversions is part of the Wellington Housing Strategy, Housing Action Plan and is one of the Wellington City Council’s priorities.

“We want people who work in the city to be able to live in the city. Any city needs a range of rentals and this will help address that,” says Wellington Mayor Justin Lester. “We need to be innovative on housing too. We want to break the mould. If we keep doing things the same way we’ll get the same outcomes.”

Councillor Brian Dawson, who holds the housing portfolio, says during the fit out the building can be upgraded to modern earthquake standards. “This is a great opportunity to inject good quality apartments into the rental market and also improve the resilience of Wellington buildings.”

The Wellington Company approached the Council with the proposal earlier this year. “We realise that there is a lack of affordable rental accommodation in Wellington,” says The Wellington Company’s Alex Cassels. “We want to help the city stay affordable for workers and for them to live in quality properties. We have voluntarily committed to meeting the Council’s rental warrant of fitness, will provide free wi-fi and rubbish collection.

“The apartments will also be fitted out with the latest LED lights and gas water heating so as to reduce residents’ costs. We are also happy to have secured a rock-solid tenant for 15 years,” Mr Cassels adds.

The first of the apartments will be available by this time next year.

5 comments:

  1. greenwelly, 14. September 2018, 15:47

    Current Council housing payments are set at 70% of the market rent (for those under certain income/asset levels). Do we know what “less than the market rate” is? Is there a definition of “essential work in the central city.”
    I’m not saying this is a bad idea, I’m just trying to get a handle on how it is integrated into the council’s existing significant housing stocks (some of which are very close to town). Also will it have any impact on its future redevelopment of its own stock?

     
  2. Concerned Wellingtonian, 14. September 2018, 17:25

    Getting the same developer to build something affordable in Shelly Bay would have been nice.

     
  3. Sarah H., 14. September 2018, 23:03

    This sounds great but the Council’s news release begs more questions …it would be good to have Council answers:
    Is the lease price fixed for 15 years?
    Can you make the lease public please (public money..not commercial sensitivity)
    Who will own the building? The developer?
    Who will control the rents?
    Why will those in Council housing be benchmarked to market rentals..(for those most in social need) but these not?
    What will the starting point for the rentals be?
    Who is an essential worker? Aren’t all workers essential?
    Can you make the criteria for renting public please?
    Why has the Council moved from providing housing for those in most need to this?
    Will each apartment be unit titled?
    What kind of governance structure will there be? A Body Corporate or something else?

     
  4. Sarah H., 15. September 2018, 1:08

    To add to the earlier questions:
    The bigger question is simply why?
    Why is WCC subsidising a developer to make a profit and to build 35 non affordable apartments..for a privileged few…”essential workers”? Is this just another cynical Public relations stunt as it is not a commitment by Council to provide “social” housing for those most in need?

     
  5. Harry M, 15. September 2018, 7:21

    I feel this is seeking to obscure the fact of the govt’s housing stuff up. It will see more developer deals, risk managed by the ratepayer and funded by taxpayers (loans from commercial banks with interest of course instead of interest free loans). We already know WCC are “friends of the developers”.